Promotional marketing has become a critical element of online sales. Customers are genuinely happier and more likely to buy if they receive a discount or a gift. When used wisely, promotional strategies can boost both sales and ROI.
Whether you’re running a promotion for the first time or looking to improve your existing campaigns, you need to ensure you’re following the right steps to create an effective campaign for your business. That means considering your objectives, nailing your messaging and using the right promo code technology to elevate your strategy and measure your business success.
In the article, we’ll cover the step-by-step process we’ve seen top eCommerce brands use to build high-ROI promotional campaigns.
Step 1: Determine your objectives
Your primary objective will likely be revenue growth. But you need to make sure to be clear about your path to that destination. Your more direct objective might be:
Increasing conversion rates
Upselling/cross-selling -- increasing customer lifetime value
Clearing slow-moving stock
Support a product launch
Improving customer experience
You can even get more specific and create tailored goals for a select period of time, or to drive very specific outcomes. Depending on your business, that could be:
Extend holiday stays to fill unsold capacity
Move “super” distressed inventory
Upsell a specific product
Create bespoke packages for tailored audience
Having specific objectives in mind will shape your strategy and allow you to pick the right metrics for measuring. The key to setting your objectives for each of these metrics is ensuring that they’re SMART (Specific, Measurable, Achievable, Realistic, Time-Based).
Unless you can tie specific numbers and time frames to your goals, understanding the success of your campaign will be challenging — which we’ll cover in more detail in step 6.
Step 2: Gain an overview of your data
Once you have your objectives, you need to think about how you’ll leverage the data coming from your communication channels. This data will allow you to deliver truly personalised campaigns where you can offer customers the kind of promotions they want, making it more likely for them to convert.
But how do you collect that data? The answer is in an SCV (Single Customer View). By collating your data into an SCV, you can organise and view all of your customers’ records, regardless of the channels and the multiple touchpoints the customer may have experienced with your business. Here is some of the information an SCV can help you collect:
Customer behavioural data: This includes data on how customers are browsing your site, such as clicks, scrolls and time spent on page. It will also show what products and categories they are looking at, added to the shopping cart or products they’ve abandoned. This can come from multiple channels, both on the web and mobile.
Transactional data: Data on the number of purchases, product abandonments, returns, order value and dates.
CRM sources: This is customers’ personal data such as their address, telephone number, email address and social media information. It would also include permissions they have given you, such as whether you can market to them via email etc.
By utilising this data, you can really pinpoint what your customers want and provide them with the relevant promotions that are personalised to them.
Step 3: Hone your promotions and messaging
The promotion you offer to your customers must entice them: the more desirable your offer is, the easier it will be to craft messaging that highlights it as such. And the right offer can even promote itself for free in the form of social shares if your audience finds it compelling enough.
How to choose the right offer
There isn’t a single, best way to do this for every eCommerce business. But at a high level, there are two different ways to think about choosing an offer for your promotion:
What can you offer to make your target market b
uy right now? This could include offering discounts on your most popular products or use time-limited discounts, decreasing discounts or mystery codes to entice customers.
Think about long-term customer value. Which products do customers buy again and again that you could hook them on? Which products did your most loyal customers buy first? Why?
Customers who have purchased once before are more likely to do so again compared to those who are new. So when you’re crafting your offer, keep that in mind.
How to formulate your messaging
If you’ve created a compelling offer, the next step is expressing it in a way that helps your audience see why it’s compelling. However, this isn’t about putting on your creative marketing hat and writing something clever — it’s about research.
The best copywriters never create messaging out of thin air. They take it right from the mouths of customers themselves via user-generated content like reviews (of both your products and your competitors), surveys, and more.
The more you can use the exact words and phrasing that your customers are, the more compelling your message will be. You can even A/B test this with the use of unique, single-use promo codes and adjust accordingly in order to ensure that the exact messaging you’re using is working.
Pro tip: Focus on benefits, not features. What desirable result does your promotion help your customers gain?
Step 4: Use the right tools
The right tools can help build a successful promotional marketing campaign — they can provide an element of automation and testing that will help ensure you execute your strategy successfully. There are many promotional marketing tools for businesses that will use data and integrate with your CRM, ecommerce platform and/or website.
The right promotions engine can do this and generate and distribute unique, single-use promo codes that you can send directly to your customers or share them through third-party partners. These unique codes can also add an element of personalisation to your campaign, which many customers crave. Studies show that 80% of shoppers are more likely to buy from a company that offers personalised experiences. Needless to say, anything you can do to personalise your promotional marketing campaigns will likely increase conversions.
Avoid promo code misuse
Not only will personalisation help you create a more desirable shopping experience, but it will also help you avoid things that could negatively impact your ROI from the campaign. In 2018, the Forter Fraud Attack Index found that coupon misuse is a fraud trend that has consistently increased. You can prevent this by personalising your messaging with a unique single-use promo code (to each person on your email list for instance). This would help you realise additional ROI you could be missing out on.
However, it’s important to remember that depending on the objective of your promotional marketing strategy, a promo code going viral may be more suitable — however, it’s important to maintain some level of control, such as a validity period or the ability to verify against the basket.
Step 5: Set a budget
Every marketing campaign you execute needs to have a budget. It’s important to remember, however, that promotional marketing isn’t just a way to give away discounts to your customers — promotions can positively impact your discounts levels.
By using the right promotions, you can drive better revenue per customer, increasing margins rather than losing revenue. In fact, discounts can encourage customers to spend more, especially on premium-priced products.
When setting a promotional campaign budget, look at your cost per acquisition (CPA) and ROI for other campaigns you’ve run and make an honest assessment of how much you can afford to reach your goals. Your margin will also help you assess this and ensure that the budget you set for your marketing strategy won’t negatively impact your business. These are your benchmarks and your goal is to improve on them.
And if you’ve crafted your campaign properly by picking the right channels, nailing your messaging and are using the right tools to optimise promo distribution, you’ll see your margins increasing.
Step 6: Measure the campaign’s effectiveness
Many marketing professionals at both large and small businesses struggle to measure the effectiveness of their marketing campaigns. For instance, one study found that 60% of companies aren’t sure how to measure the ROI from social media.
Promotional campaigns are no different. Businesses can struggle to adequately assess the effectiveness of their promotions because doing so is a lot more than just looking at total sales. For example, you might see an increase in sales but still lose money because your overall ROI decreased at the same time. Or your sales may have spiked for a short while — but how many of those who purchased requested a refund? You need to consider all of these factors when measuring your performance success.
A successful promotion requires setting measurable goals regarding the numbers behind your sales as well. Here are several metrics you’ll want to focus on improving as part of your overall objectives for any promotional campaign:
Conversion Rate (CVR): The percentage of website visitors that take a desired action e.g. buying something from your site.
Promotional Lift: The percentage increase of website visitors who purchased as a result of the promotion compared to normal.
Cost Per Acquisition: What you spent to acquire a single customer with your promotion.
Campaign Refund and Return Rate: The number of customers who bought as a result of your promotion and then requested a refund or returned their purchase.
Average Order Value: How much the average promotion recipient spends when they purchase.
Campaign ROI: How much did you spend to run the campaign compared to how much you earned from it?
ARPU (Average Revenue Per User): What’s the average amount of monthly revenue that each user is generating?
Average Discount: What is the average discount rate you want to offer?
Margin Uplift: The sales minus the cost of goods sold.
You need to have adequate visibility into the metrics underneath your sales to understand how effective your promotional campaigns are. And far too many companies aren’t sure how to measure these with enough granularity. Especially when they start implementing personalisation into them!
Use technology to measure success
That’s where the right tools — like a promo code engine — and the right promotional strategies are so critical. Unless you can see precisely how your promotional campaigns performed (and understand WHY they did or didn’t), you’ll miss out on insights that could contribute to future growth.
The right software that provides unique single-use codes is also a great way to achieve effective A/B testing as it tracks individual codes and how they’re used. This allows you to experiment with your promotional campaigns and adjust according to your results, meaning you can gain the outcomes you want.
Focus on the offer and outcomes
The number one takeaway for creating effective promotional campaigns is to focus on creating an offer that incentivises the outcomes you’re hoping for. Keep in mind this could include things other than sales, such as increased market presence, greater brand loyalty, or an increase in long-term customer value!
And remember, the right promo code software can help elevate your campaign, making it easy to generate, distribute and then measure the effectiveness of unique, single-use codes that you provide to your customers.
If you’re looking for a promotional marketing solution that gives you flexibility with the kinds of customisable promotional campaigns you can execute, Uniqodo’s Promo Code Engine might be the right fit for your business. However, whatever solution you choose, ensure that the promotional marketing campaign you build for your company works for you — our eBook, The Ultimate Guide to Using Promo Codes, will help you learn how you can use promo codes successfully.