Why Coupons are a Terrible Way to Track Advertising
With the plethora of marketing education and advanced tracking tools available, sticking to coupons as a primary advertising metric is not just archaic but detrimental to a brand's long-term growth and understanding of its customer base.
In an age dominated by information, analytics, and precise tracking mechanisms, the use of coupons as an advertising metric seems incredibly outdated. While at first glance they may seem like a simple and effective way to measure the impact of an offline campaign, a deeper look reveals multiple limitations that make them an inefficient and often misleading advertising tool.
Here are some reasons why relying on coupons as an advertising tracker can be a poor decision.
Lack of Precision: The biggest limitation of coupons is that they don't provide comprehensive data. While you can track the number of coupons redeemed, you don’t get a clear picture of the total engagement with the advertisement. For example, many people may see the ad, consider the offer, but choose not to redeem the coupon for various reasons in that instance. But later, they may take action at your business because of the initial ad they saw with your coupon, but never actually use the coupon.
Limited to Immediate Sales: Coupons, by their very nature, are designed to spur immediate action, which can bias tracking towards short-term conversions. Marketers need to understand the value of brand recall, long-term customer relationships, and multi-touch conversion pathways. Relying solely on coupon redemptions doesn’t account for these nuanced aspects of advertising that affect every advertisement and every consumer.
Discount Dependency: Over-reliance on coupons can train customers to wait for discounts rather than appreciating the full value of a product or service. This can erode brand value over time and reduce profitability.
Potential Misattribution: If multiple advertisements offer the same or similar coupons, tracking becomes muddled. Which ad prompted the customer to use the coupon? Without precise tracking mechanisms in place, you might be attributing the success of one campaign to another, skewing your advertising insights.
Inflexibility with Changing Market Dynamics: Coupons don't provide flexibility in dynamic market situations. For instance, if a product's price is reduced or if there's a sudden change in market demand, the value proposition of the coupon might become irrelevant or even counterproductive. Like when the whole world shutdown becuase of COVID 19 precautions. If you direct mailed a coupon during that time, the results would have been dismal, all the while your ad was still delivered and viewed by the consumer… they just couldn’t act on it in that moment.
Limited to a Specific Audience: Coupons are more likely to attract bargain hunters and won’t appeal to the broader audience you aim to target. By focusing on coupon redemptions, you neglect to take into account every consumer that acted on your advertisement, but didn’t use the coupon.
Operational Challenges: Managing physical coupons will be logistically challenging. Ensuring they reach the target audience, tracking redemptions properly, and integrating them into modern POS systems is cumbersome. Perhaps you have a coupon running and your clerk doesn’t properly record it in the POS system, or accidentally trashes the physical copy that was redeemed. Did the ad not work? No, but you think it did not because it was improperly handled.
We get it. You want to make sure you’re not wasting money on advertising, but relying on them as your primary method to track the effectiveness of advertising campaigns is shortsighted. Instead, use them as a larger marketing strategy to drive immediate sales or clear out inventory. And then, commit yourself to understanding the big picture of your marketing plan that will serve you better.
These articles will help you gain a better insight on how your ads should be working