Six Strategies to Break the Coupon Rut & Increase Loyalty
by Samara Anderson
Nothing keeps a marketer up at night like bad promo planning. The same shoppers only come in on Saturday or Sunday when the weekly ad breaks. They use their coupons or buy on sale subsidizing volume, and won’t make another trip until the retailer or brand creates another discount. It’s a bad cycle. Coupons and TPRs (temporary price reductions) cause competing retailers to push base sales to the price floor, causing market disruption, brand erosion, lost equity and loss of loyal shoppers. Nobody is happy.
Challenged by discount dependency? To protect your brand and create solid shopper loyalty, we’ve outlined six strategies:
1. Sweat, Blood & Tears are in Your Brand Equity
You and your team have spent countless hours/months/years building your brand, why would you give it away? The value in your brand or store lies in uniqueness and by discounting that, you create a commodity. Which means you should go to great lengths to protect it; consistency of message and delivery, saying no to some retail channels that aren’t a good fit, establishing a solid brand block at shelf, and investing in content and innovation to create your own curve to stay in front of the market.
Carhartt speaks for hard work; the signature yellow and wave logo immediately tells consumers the product is rugged, tough, designed to withstand extreme conditions and will last. Other brands try to replicate it, but Carhartt is a staple of its target audience, “the hardworking men of America”.
2. Let’s get Emotional
Shoppers spend their dollars by emotion and tell themselves it a sensible, rational decision based on need later. Deep brand connection at the archetype level lasts, simply because the person sees themselves in the brand, whether aspirational to make them better or to further define their personal brand. When shoppers identify with your brand, they like and trust you, which leads to sustainable sales, strong word of mouth and reviews. It’s not enough to show shoppers what your product can do; it has to connect with them personally in an authentic way. If it doesn’t, then another brand is likely to come along and do it better.
What connects shoppers to your brand? Do you understand its niche in your shoppers’ lifestyle?
Starbucks understands its audience and has evolved ahead of the market and set trends for environment sustainability, local conscious and global social impact. Even with 25,000 locations in 75 countries, they speak to their target coffee lover. We aren’t going to buy coffee, we’re getting “Starbucks”.
3. Create the Ambiance
Put yourself in your consumers’ shoes; have you ever walked into a store and felt immediately at ease? The cross-merchandise displays, endcaps, atmosphere, helpful staff? Or received a package in the mail of a routine order, and felt like you were opening a gift? The tissue paper, crisp under your fingers, perfectly coordinated to the brand’s signature colors revealing a pretty bow over your purchase? This embodies the brand experience and how your shoppers consume the elements of your brand palate. The more new shoppers feel at home and aligned with your brand, the more likely to build the connection.
Nordstrom is great example of a brand experience, the coordinated look, tasteful displays, planned events for shoppers to see new trends, and the return policy. No matter what you bought, in any condition, can be returned. No questions asked. Makes you giddy with trust, doesn’t it?
4. Members Only
Creating a community of shoppers does a few things for you; you gain valuable data on your target audience, you can use push technology to connect and you can utilize this audience to gain feedback and test potential line extensions. It seems everyone has a loyalty program or membership these days. But very few provide value and exclusivity to their shopper where they will stay engaged.
LEGO® does this amazingly well with a free kids membership offering valuable content through it’s 6x a year LEGO Life Magazine. Kids can participate by submitting photos of the bi-monthly challenge, win prizes and discounts through online contests, and see themselves on the pages of the magazine with their creations. Not to mention LEGO TV, apps by product line, online community, LEGO land, the content is endless…..
5. Surprise & Delight
As you seek your shoppers, continuing to innovate and establish connection is necessary. There are plenty of ways to do this: surprise freebies and samples as your membership makes more purchases with you, engaging with up and coming artists, personalities or social influencers for a creative collaboration as an exclusive, and creating a give back enterprise where shoppers’ dollars benefit a cause closely aligned to your brand vision. Initiatives like these speak to the shopper emotionally and they will continue to come back to see what’s new.
Ulta Beauty consistently builds upon its endless events, monthly themes (“Jumbo Love” for July with bonus pack sizes), shopper rewards program and sampling. Visiting an Ulta weekly provides the shopper with a new experience every time; new products to try, new seasonal endcap displays, and more points to redeem.
6. Time is Running out…
When you do put these strategies in place, be sure to create urgency for shoppers to engage. Short timeframes can increase buying rate, impulse purchases, an additional trip per month with the opportunity for an overall bigger basket, help to drive traffic for your slow day of the week and move additional units creating pantry loading. Shoppers’ attention span is limited anyway, so make the most of the opportunity to get noticed.
The ultimate example of creating an urgent call to action based on absolute nothing is Amazon’s Prime Day. On this year’s Prime Day, July 16–17th, “36 hours of deals” helped Amazon deplete inventory, created co-marketing programs (and big fees) for brands and got incremental purchases out of Prime members.
Brand equity, emotional connection, experience, loyalty programs, surprise and urgency can create a sought-after established brand that isn’t dependent on price and discounts. You’ll find yourself building a lasting relationship with your shoppers, providing value for price, which will open even more doors for brand growth.