Voucher codes have long been a staple of performance marketing. Price-savvy consumers are habitually seeking incentives that reduce the cost of goods and services, with this playing directly into the hands of the third parties that distribute them.
Studies have found that shoppers are saving small fortunes on purchases related to restaurants, cinema trips, clothing, electronics and other products, with a staggering nine in 10 consumers actively looking for money-off incentives as they go about their everyday lives.
Voucher code usage is undeniably strong, but questions over the current model remain.
Aside from the oft-touted debates over incrementality and true value to retailers, the circulation of discounts via third-party sites can be a barrier to a seamless route to the checkout, as customers migrate their basket in search of a deal.
Another consideration is the vast chasm between reported levels of voucher-code popularity on a backdrop of a rush towards more personalized, better-informed advertising. Marketers are told that 71% of consumers prefer offers that are tailored to their shopping habits, with 65% believing this to enhance their loyalty towards a brand.
In the face of these results, it’s still common for an intent buyer – someone who could have repeatedly bought from the same brand – to head to a voucher site and be served an overview of what’s ‘trending’ or a set of codes that are being applied nationwide.
While there is certainly room for improvement, our opinion is that voucher codes are actually heading towards their peak, as a wave of innovation looks set to change the way these incentives are delivered.
Though advancements in voucher-code delivery may have stagnated in the last 10 years, one thing we expect the future to bring is a focus on personalized incentives.
This was a huge consideration for RevLifter in the development of our core product; an intelligent e-commerce personalization tool which uses rules, machine learning and AI to serve tailored discounts on the retailer’s own property.
We utilize information around things like basket contents, customer demographics, and status (e.g. new or existing customer, high or low order value) and allow brands to select rules that inform the delivery of each incentive. This presents a huge opportunity for our clients to launch an incentivization strategy which is based on the specific goals, and customers, they want to drive.
Will it prove more popular than visiting a voucher code portal? Well, if certain users are dealt with an on-site incentive prior to checking out, there is certainly less of a reason for them to migrate the page. We are even running SEO and PPC-optimised deal pages which target people searching for vouchers on Google, ensuring an optimum level of coverage.
Early trials have shown this to be effective, with advertisers witnessing up to an 80% improvement in AOV and up to a 100% increase in conversions against their current voucher code activity. Users have declared an interest in personalized incentives and the voucher code industry must react to it.
AI in performance marketing
Our team has spent years working in and around e-commerce and performance marketing. That time has seen no shortage in the adoption of new concepts, and we’re on the cusp of embracing one of the biggest yet.
Artificial intelligence (AI) is said to be working wonders for paid search; an area where algorithms can feasibly detect suitable formulas and automate the increasing and lowering of bids. Less can be said of another dominant area of performance marketing – incentivization – where publishers are still getting to grips with the next generation of technological advancement.
What place does AI have in this ROI-driven space? Consider the use of algorithms to detect the most suitable deals, based on reams of purchase data and on-site interaction, and the use of automation to serve them up in real time.
RevLifter has baked this feature into its Deal Intelligence suite with a view to guiding brands towards a new method of conversion rate optimization. Analysts envisage a rich future in AI for creating personalized product recommendations, one-to-one messaging and campaign optimization, so it makes sense for offers to enter the frame.
Of course, AI won’t do much for the strategies where a 10% coupon is applied in the lead up to Black Friday, but not every account is run in this way. As a judge of countless marketing awards, I see lots of testing, tweaking, and refining of voucher campaigns, based on what’s working. It begs an obvious question: what if all of these actions were automated to bring the best possible result?
We were enthused to see the Performance Marketing Awards launch ‘Best Use of AI’ as a category in 2018. The shortlist was largely a network and agency affair, with CJ Affiliate and iProspect making the cut, but expect to see a voucher contingent in the future.
Data feeds very much into the AI play; the basis of great trials in this area are founded on a robust source of information. However, such an important feature deserves the spotlight for a brief moment.
Almost every online discipline is being revolutionized by data, causing marketers to make decisions based on what they actually know about their activity, not what they think they know.
Beyond this, we should be using external data as a means of delivering the right incentive to the right user, geared towards that specific moment. Maybe the weather has taken a turn for the worse and it isn’t a good idea to discount waterproof clothing while their stocks are being depleted. RevLifter is always looking for new factors to influence its choice of incentives, with the real-time aspect being of high importance.
In 2016, the majority of marketers (63%) upped their spend on data-driven activities. Voucher code delivery and performance marketing, in general, should not be exempt from the use of data for improved decision making.
A final feature of tomorrow’s voucher strategies, we believe brands should be given more control over the ways in which they incentivize audiences.
Third-party websites have to meet strict criteria set by the brand in order to secure their commission, so there isn’t really an issue of control in this sense. More worrying is that initial passing of the user experience across to another source.
Perhaps the customer migrates their basket in search of a discount, only to land on a voucher site and see a better deal from a competing brand. Maybe the first few results in the SERPs return nothing in the way of valid codes and a consumer’s £500 basket is left abandoned as a result of their prolonged consideration.
User experience is a big focus for RevLifter and we’ve developed a toolset which ties it to the brand’s owned properties. Through on-site messaging, emails and SEO-optimised voucher hubs, we give our users an arsenal for converting people at opportune moments.
It’s our opinion that many of the qualities of voucher-code delivery by third parties are being overlooked in favor of the flaws, which include a lack of control over what each customer does.
What does the voucher strategy of the future look like? For us, it’s a more data-driven, more technologically advanced version of the present.
It’s agile in its ability to react to changes around the selling environment – the user’s behavior or the day on which they make a purchase – while catering for the interests of shoppers and brands alike.
Performance marketing has been slow to react to some of the new trends that are flooding our digital landscape. AI and data are prevalent around so many of our channels, but they could find their best home yet within voucher strategies.