A Data-Driven Look at the Impact of an Affiliate Coupon Strategy
Sep 26, 2018
More than 1,000 attendees attended CJU18 this month for three days of networking and to learn the latest industry trends and research from CJU’s educational sessions.
One of the most highly anticipated sessions at CJU18 was presented by Google, who debuted the results of a new study that analyzed the behaviors of shoppers exposed to online coupons and paid search coupon ads. “The Evolving Digital Consumer: Unlocking the Full Value of Coupons and Codes,” was presented by Google’s Kieran Campbell, Partner Lead, and Andrew Ricker, Analytical Lead. These two Google associates shared what they learned from a six-month observational study of coupon shoppers: Coupons, as part of an affiliate strategy, deliver both short and long-term benefits to retailers.
“They’re a critical component of a consumer’s shopping journey and an expectation that more than half the population is going to have,” said Kieran Campbell. He also shared eMarketer prediction that digital coupons will be used by 55% of the US population by 2021.
A key question the study needed to answer, said Ricker, was whether a coupon strategy is driving additive sales, or if coupons are instead driving sales that would have otherwise occurred. The finding: “The behavior feared in the industry, in which a shopper is at the checkout stage and then leaves to find a coupon, that really only happens about 6% of the time. People are starting their journey by looking for deals and then proceeding to go buy,” said Ricker. “What we see is that 94% of the transactions driven by coupon affiliate paid search ads were incremental…[the shoppers] were not already on the retailer’s site.”
According to Ricker and Campbell, another key goal of the study was to understand if a coupon strategy increases the likelihood of purchase. “At Google, we know better than anyone that advertising and marketing needs to translate into business impact.” To understand this, comScore compared audiences that were exposed to coupon ads with a control group that was not exposed to coupon ads. They found that the audience exposed to coupon ads were “2x more likely to convert on a retailer site.”
Ongoing Benefits to Brands
To further round out their study, Google asked comScore to analyze how a coupon strategy impacts brand loyalty and purchasing past the initial coupon-driven purchase. “We found, in terms of overall value of having coupons, that there is more brand loyalty,” said Ricker. “We saw that someone who used a coupon to make a purchase was twice as likely to go and search for that brand afterwards.”
Over a six-month period, coupon users go on to make more purchases overall than non-coupon users. According to Campbell, “Not only do coupon users search more often, they keep coming back to the same retailer to make multiple purchases. We observed that coupon users generated 5% more revenue than general shoppers over a six-month period.”
“Sales driven by coupon customers were more incremental than we had previously thought,” concluded Campbell. “In a comparison-shopping era, with pressure on margins and EBITA, coupon and affiliate partners help solve problems in terms of brand loyalty and increased value. And over time, these users thank you for that and they become loyal to [your] brand, continuing to engage, make purchases, and search for you.”