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  • Tayyiba Tabassum

Digital Coupon Marketing Trends: How Will eCommerce Promotions Look Like In 2021?



The year 2020 was a pivotal time for the world as we knew it - the events of the year had permanently transformed the global business landscape. With the rapid spread of COVID-19, many businesses had to convert their customer experience into a digital one. The acceleration of e-commerce throughout the globe has been hard to ignore, as consumers turned to online shopping often out of necessity. It became clear that brands had no choice but to rapidly adapt their strategies, focusing on improving the customer experience online. In this blog post, we will highlight several key events that transpired in 2020, as well as explain how these occurrences have impacted digital coupon marketing and loyalty trends today.


The events of 2020 changed people’s expectations across the globe.


The year has been tough for everyone, for governments, businesses, and individuals alike. The world did not just go through one, but rather a handful of events that led to significant changes and turmoil throughout society: multiple waves of lockdown restrictions, fluctuating stock markets with an increasingly volatile global economy, and


the calumny of US elections. In between, we saw the Black Lives Matter movement crushing generational racism norms across America, while several wildfires, a record number of powerful Atlantic storms, large-scale deforestation, and rising sea levels threatened to destroy livelihoods and landscapes across the globe. Political unrest in Europe and Asia only made matters worse. There have been many changes in all areas of life, and while some of them were painful they also taught us important lessons, as well as led to a lot more unity, understanding, and compassion across communities. All in all, the turbulent times forced us to slow down and rethink what really matters in life.


From consumer behavior to demand prediction to retention, the events of the last year have altered or sped up almost every facet of online retail. Against the backdrop of a threatening environment, consumers now expect their beloved brands to be more empathetic, express values that care about social issues, and more importantly, act on them. According to a survey by Yotpo.com, consumers are more emotionally invested in their favorite brands now than they have been in the past, viewing the shopper-brand relationship as more than just a transactional exchange. This also helps explain why, in 2020, survey respondents were more likely to spend more on a brand they’re loyal to, to support the business - it’s no longer just about the money. Gender inclusivity, racial diversity, moral and social responsibilities carried out by brands, sustainability, and environmental concerns have become important for consumers when making purchase decisions.


Ikea’s discontinuing the printing of its 70-year-long run catalog in 2020 is proof that consumers are no longer content with paper-based channels for product information, that use precious resources. The move came as a surprise to many long-time customers who were accustomed to flipping through the pages of the colorful paper publication in search of their favorite furniture pieces. This comes in as a realization of the global environmental issues, as well as the decline in readership due to consumers becoming increasingly digital. Another great example of a brand implementing radical sustainability changes is H&M. The company recently integrated recycling and sustainability as one of its cornerstones and started a Garment Collecting program that allows consumers to hand in unwanted clothes from any brand, in any condition, and receive a £5/5€ voucher in return. This alignment with consumer values and behavior was necessary to retain its large customer base, increasingly concerned about fast fashion polluting the planet.


The upcoming tendencies in the 2021 retail environment.


The remodeling and growing competition in the marketing arena is compelling marketers to be more creative, deliver real-time content based on behavioral patterns and make it visually engaging. With the advent of innovative technologies such as artificial intelligence, IoT, virtual reality, and mobility, modern marketing has reached a whole new level. The growing operation of 5G will increase the utility of smartphones and IoT devices in users' lives. Hyper-personalized content delivery, high-bandwidth digital experiences, and faster websites will ensure an exceptional boost in Customer Experience.


Although the vaccine is on the horizon, it appears that sliding back to the old normal is not an option. Retailers have successfully paved the way to adapt to customers’ needs throughout the pandemic, but with the industry still navigating through these difficult times, it’ll be those that continue to do so who survive and potentially thrive in the months ahead. Trends, strategies, and technology platforms never seem to sit still.


According to econsultancy.com, November, and December, 2020 saw online sales growth of 39% and 37% respectively. Much of this growth has been due to the Black Friday discounts and Christmas Holiday vouchers offered to shoppers. Moreover, 72% of British shoppers think that retailers should offer more promotions in a time of financial uncertainty. With 60% of consumers spending less in the past year due to pandemic-related financial instability, brands have to provide shoppers with smarter, optimized discounts to encourage engagement. This is where personalized, trigger-based coupon marketing comes into the picture.


As marketers and business owners, we must always be looking ahead. We are asked to make sense of the present so that we can anticipate changes before they happen, building a better future for our customers and ourselves. This involves a lot of creativity but also requires us to study trends from the past in order to learn about how things will be different moving forward. So, we went ahead and did all of the above research for you. Now let’s look at some of our findings on how the digital coupon marketing trends will look like in 2021.


1. The need for a safe experience has led to a shift from paper-printed to digital mobile coupons.


With digital mobile coupons in the form of QR or bar codes, consumers can easily maintain a safe distance and reduce person-to-person contact in a physical retail store - an important factor during the pandemic. The redemption of such codes is easy and user-friendly - the consumer can display the code on their phone so the cashier can scan it and validate the transaction. Since the global lockdowns increased customer adoption of digital wallets and mobile devices in brick-and-mortar shopping transactions, it is very likely that more people will continue to buy things using their phones. According to Invesp, 59% of consumers claim that out of all the different types of promotions a retailer can employ, digital coupons are the most convincing factor influencing a purchase decision.


Retailers should appreciate the following advantages of implementing mobile digital coupons:

  • such coupons are relatively easy to distribute across customer's channels like email, SMS, mobile messengers, or push notifications

  • mobile coupons can be easily rewarded upon customer action in real-time, like signing up for a digital newsletter or being in close proximity to the store

  • digital mobile coupons rarely get lost and can be easily pulled out from a mobile digital wallet or an email application

  • the fact that the consumer hasn't redeemed their coupons yet can be a great reason to remind the customer of the coupon expiry date and retarget them back to the store

  • personal mobile digital coupons can be used to gather additional information about the customer and the redemption transaction

As deforestation has been an overwhelming problem around the globe, implementing digital coupons is a more sustainable practice and aligns with the growing environmental concerns.


Read next: Mobile Coupons - Integrating QR codes in your promotional strategy. 

2. Bridging the gap between in-store and digital


With the aim of streamlining and automating the process of discount redemption and improving customer service by reducing waiting time, customers can now obtain personal promotional codes, in the format of QR codes and barcodes.


In order to obtain tailored information for data capture, businesses can send barcodes or QR codes that the customer can scan in order to get a discount voucher. Participants complete a registration form, which can be fully customizable with details like name, email, city, telephone, date of birth, etc. You can also ask the users to upload photos, videos, fill out a survey, or answer a simple question.


Here is an example, based on REWE Supermarket chain in Germany:


Rewe leveraged physical cards, given upon supermarket purchase, to convince shoppers to scan the QR code and sign up to check the win. The goal of this was to create an addressable contact with consumers.






Another way is sending the coupon straight to the participant’s inbox, the redemption process becomes much easier as the user can access it directly from their smartphone. This way the customers can have all-time access to the codes and at the same time, the businesses can use geofencing data to personalize promotions that are nearby, according to availability and safety.


Additionally, this also helps with social-distancing norms when people have to stand in long queues, as businesses are slowly opening in-person stores, easing the process and giving a good reason for your customers to wait patiently.



3. The rise of Subscription Vouchers


To have a steady and dependable income, a growing number of online retailers—especially those without an offline presence—have tapped into the experiential retail component through a subscription model: offering specially-selected boxes of products to customers on a regular basis, typically weekly or monthly, for a modest fee.


Initially, the subscription was limited to periodicals, newspapers, and telecommunication services. In this way, customers were offered periodic, rather than single sales or access to a product or service. Thus, a one-time sale of a product can become a recurring sale and can build brand loyalty. This gathered greater momentum in the past year as retailers needed a scheme for a steady income and at the same time consumers needed an alternative, remote, safe, and easy way to get their needs fulfilled.


To convince consumers to sign up for longer periods of time brands now offer vouchers for a decrease on the monthly subscription. It provides an influx of cash, usually, annual plans are priced at 10x monthly price, so represents a discount to the customer and locks the customer in.


For example, Amazon has a ‘Subscribe and save’ program that enables you to receive a discount off the Amazon and Amazon Marketplace everyday low prices on eligible products. You always enjoy free standard shipping on auto-deliveries, and the convenience of regularly scheduled deliveries when you receive your subscriptions on your Subscribe & Save delivery day. There are no commitments, obligations, or fees and you can cancel a subscription at any time. To encourage customers to subscribe, vouchers are planted on targeted products, say 20% discount, only for those who subscribe to the program.



Aldi, a UK-based supermarket chain, in the midst of the coronavirus crisis in 2020 ventured into selling groceries online, beginning with a ‘food box’ of essentials (the likes of which many other grocery brands were offering) and moving into a partnership with Deliveroo to sell groceries through its app and finally launching a fully-fledged online grocery store with click-and-collect on a subscription basis, where customers are allowed to make a list of all pantry and kitchen essentials as well as vegetables that comprise of a subscription box that is delivered at the customer’s doorstep at a weekly or bi-weekly basis. They provide vouchers for monthly subscriptions in order to encourage customers, taking them ahead in competition with other supermarket chains.


Function of Beauty, a hair and skincare brand runs a fully online business, providing subscription services where they curate packages for customers with their selected products, say shampoo and conditioner, to be delivered on a monthly basis without a multi-payment requirement. The customer has to sign up for one of their plans and pay altogether and the items are delivered to them without having to follow up. They also provide discounts for subscription plans that amount to an overall lesser amount than the repeated payment for individual items.


4. Improved Loyalty Programs, based on mobile messengers

In an article by thepointofloyalty.com, CEO Adam Posner believes that customer retention and loyalty will receive greater investment than customer acquisition in 2021.


Surveyed by yotpo.com, respondents in 2019 and then again in 2020 reported that they wanted more out of a loyal program other than free shipping and discounts which, in today’s world, are considered a low bar.

Two distinct responses, “early access to sales” and “early access to new products,” shot up considerably from 2019 to 2020 — 42.0% to 60.1% and 30.3% to 50.8%, respectively. “Offers and recommendations tailored to you” also went up, from 32.7% to 38.9%.

The main takeaway? Your customers actually do care about more than just free shipping and discounts when it comes to your loyalty program; for many, getting a VIP experience — early access and personalized recommendations — has become significantly more important since 2019. At the same time, customers also consciously look for moral, social, and environmental responsibilities, in their decision to continue to stay loyal to a brand.


Even in difficult times, members of a customer loyalty program can bring more value to your store. A major benefit of loyalty programs is you can do more to keep customers coming back and spending more. As you start to turn existing customers into loyal ones, you’ll see the importance of customer loyalty management shine through in the long term. One of the biggest benefits of customer loyalty programs is that they can stop you from needing to compete on price alone. Connecting with your customers’ emotions gives you a way to set your store and your brand apart – offering a much more enhanced (and personal) customer experience.



For example, Estrid, a female-focused razor company that is a vegan, cruelty-free, and body-positive brand that also looks at climate-compensated shipping and also com. It allows customers to receive discounts in the form of charity coupons. This essentially means that they have coupon codes that allow customers to donate to noble causes, such as women’s rights societies, when the code is entered.

This way the company can give back to the community without abandoning its business goals.


5. Payment Vouchers


The fame of payment vouchers rose to a greater height during the covid-19 pandemic, by way of accepting purchase orders and payments online. Even though it seemed like the golden solution for the lockdown, we are sure it is here to stay.


Payment vouchers are kind of similar to gift cards or ‘gift vouchers.’ They can be used to pay in advance to unlock a discount. But there are many more applications convenient for today's situation. According to a survey report by xccommerce.com, 72% of British shoppers think that retailers should offer more promotions in a time of financial uncertainty. This comes as a push for businesses that didn't think about digital coupons as an option are now going for it and also for places where online payments were not common are now adopting it.


For example: On one hand, the likes of Boohoo are thriving – the fast-fashion retailer saw its sales rise 40% during the four months to the end of December. It included easier payment options as well as payment vouchers such as a 20% discount on a total purchase of over $120. On the other, there is Primark, which is expected to lose more than £1bn during the first half of its financial year. Primark refuses to sell online, of course, meaning that it has remained entirely stagnant through each lockdown period.


Another form of payment voucher on the rise is through QR codes. The customer is reminded of completing their purchase for their local businesses based on their location. The QR code checkout process pulls funds needed for the purchase from the customer's PayPal or Venmo account balance, bank account, or debit or credit card, in a similar way to an online transaction. The customer will be allowed to avail of a discount upon scanning the code. This is convenient for the customer as well as an advantage for the seller, while also encouraging sales for local businesses.





6. Proximity marketing with NFC and QR Codes


Also known as “hyper localization marketing”, proximity marketing involves targeting potential consumers with personalized ads. These ads are based on how close a consumer is to a specific location. Ultimately, the ad has the objective of converting the prospective customer into a consumer of your product.


In many cases, the ads feature discount codes or vouchers to encourage the purchase of a specific product. An app-less way of running proximity marketing campaigns is by using NFC and QR codes.


NFC key cards and stickers have an added layer of QR codes on top to enable all smartphones – Android and iPhones to tap or scan them to reveal the hyper-contextual marketing campaign.

From changing the foreground and background color to adding a logo, businesses can use dynamic QR codes, allow to re-use the same QR code to deliver different campaigns at different times of the day or week.


A few of the benefits of Proximity marketing are:


  • Geotargeting is easy with proximity marketing

  • Proximity marketing increases app engagement

  • Beacons help to improve app retention

  • Proximity marketing helps you gain a competitive edge

  • Proximity marketing gives you immediate conversions

  • Proximity marketing = a personalized experience

What’s more! Proximity marketing isn’t just limited to mobile devices but wearables can also receive beacon notifications. As per the report, ‘Market for Proximity Marketing,’ the market worth is expected to be worth USD 52.46 billion by 2022. So, if you are seeking new ways to gain a competitive edge, it’s time you suggested proximity marketing.


Conclusion


The surprising and unprecedented times in the past year and the new normal have been accepted to stay around for some time and businesses have positively molded these to their own advantages and successes. More and more people are using Digital coupon marketing today and fuelling the game with automation and personalization of coupon marketing.


Get in touch with Vouchery.io to kickstart your business with AI-powered promo management and automation.


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