A coupon code, also referred to as a promo code, is a computer-generated code consisting of letters and/or numbers that is used on an e-commerce website. When a user enters a coupon code into the corresponding field, they receive a discount, whether that is a fixed discount, a percentage off the entire purchase price, free shipping, or any other discount as advertised by the merchant.
Coupon codes can be obtained by consumers from advertisements, reaching a specific dollar amount when a purchase is made, or as an incentive for being referred by an existing customer.
Online merchants offer coupon codes as an incentive to shoppers to purchase from their website. It benefits both sides customers save money on the products they want, and merchants generate revenue. Coupon codes work well with both new and returning customers and are an effective way to track marketing efforts. Merchants can track their efforts by attaching specific coupon codes to specific marketing campaigns or advertisements. This will reveal which platforms generate the most traffic or lead to the most conversions.
Coupon code types
There are three types of coupon codes online merchants can offer. As a general rule, it’s best to use all three types to ensure a variety of customers.
- Public codes are codes that anyone can see or use. They are sometimes displayed on the website’s home page and are valuable for attracting new customers and encouraging shoppers to return.
- Private codes are used to target a specific group of people. These could be provided to loyal customers for special shopping opportunities or first-time shoppers to build a relational base.
- Restricted codes target a single use and can only be used once. For example, a code couple be sent to a customer as an apology for a delayed shipment or as a thank-you for referring a friend who made a purchase.
Coupon code sites
In addition to finding codes offered directly by an online merchant, there are multiple websites that track new coupon offers from merchants, such as RetailMeNot and Coupon Cabin. These sites typically aggregate thousands of current coupon codes into one, centralized place. Users can search for retailers and display coupon codes that may or may not be valid. The success rate of specific coupon codes are also shown.
