Your discount programs–are you solving pain points or creating them?

Posted on Jan 3, 2012 · 6 min read

There’s this thing, called the Internet…you can do all sorts of things with it. You can look up facts, like how many plastic surgeries Cameron Diaz has had. You can communicate with people about what you had for breakfast, and post pictures of the Virgin Mary’s image on your toast. You can also sell stuff. That’s right, on the Internet, you can sell stuff. The cool thing is, you can sell stuff to people outside your neighborhood. That means you can sell a lot more stuff to a lot more people. This Internet thing is huge, right? Like revolutionary!

No, this isn’t a blog post from 1994. This is a message to all those merchants out there who advertise, market, promote, and yes, even sell on the Internet, but still think it’s a valid shopping experience to ask customers to walk into a store to finish a transaction. I’m putting on my saffron robes, stepping up on a soapbox, and holding my signs that I finger-painted this morning with pistachio-flavored instant pudding—People, I implore you, the end is near.

Companies of all sizes make the mistake of focusing too much on their product and not enough on their audience. When I speak to my groups of small business owners and marketing students about who their audience is, I get a lot of bored faces and everyone stops taking notes. It’s not any fun to talk about. Throw up a slide of how adding a contest to a podcast increased revenue, or how using Google’s webmaster tool got us 2 million views on YouTube in six months, now that’s fun. But talk about creating a profile of your target market and determining your customers pain points and people start checking their fantasy lacrosse team’s stats on their smart phone.

So I’ll lob you a soft, slow one—making people leave an online shopping experience to finish their transaction is painful. As a marketer, we are supposed to be getting out of bed every day to solve a customer’s pain with our products. We’re supposed to be dedicated to solving pain points. But if you tell a customer they can have a discount only if they shop in-person, or make them join a club to get a discount, you’ve created a pain point. Which means that too often, your customer will go someplace else to buy instead, and complain about you to anyone who will listen on their entire journey.

Show and Save

Leave it to marketers to create a difficult process to use a discount, then give it a cute name in hopes that no one will notice that it’s root-canal-painful. “Show and save” is the process of getting a student or military discount by showing your id. Because customers currently can’t “show” a student or military discount online, they have to go in person.

There are even “solutions” out there to help you create a “show and save” program. The student or soldier can pay to join and get a card. They then show that card to prove that they are a student or soldier. But wait, there’s more pain. We’ve called several of those retailers who accept the “club” cards, and they still require that you show your student or military i.d. with the “club” card that you paid for. Are you as confused as I am yet?

I wish I had some stats for you to prove my specific point of how lame it is to tell people they have to buy from you in person, or ask them to pay to join a club to prove that they are who they say they are. But I don’t. Here are some nuggets to chew on that at least circle in on the issue:

1. There are studies done that show that adding one extra step to your online shopping cart reduces your conversion rate by 30%–like adding a phone number field when you don’t need it, or requiring a password. So you can imagine if you asked them to get in their car…

2. We recently completed a survey of college students that showed that 72% of college students would use student discounts more often if they were easier to use.

3. Costs for an online transaction are a fraction of the cost of an in-person/brick-and-mortar transaction. It is a different number for every business, but ranges from 40 – 75% cheaper for a customer to use your website to make a purchase.

I get it. Targeting a specific market is how marketing works. It makes for a better targeted message, makes for a more efficient marketing spend, and should lead to better results. But we need to fast-forward to the end of the movie. It’s not pretty. John Cusack doesn’t get the girl and there are no plans for a sequel. When you are a store who markets to students and military, but then tell them that they can’t redeem their discount online, you’ve doomed your marketing to, at best, mediocre results.

A good blog post would now offer four steps to fix this broken process and increase your ROI, your conversion rates, your reach, and your market share. I don’t have a list. SheerID offers a solution that verifies the identity of college students, or any other group that you deem worthy of a discount. The verification happens in your online shopping cart, and your customer doesn’t have to do anything, they won’t even notice it is happening other than high-fiving their cat over saving a bunch of money and having a sweet online purchasing experience.

To save this blog post from being one giant sales pitch—don’t call SheerID if you aren’t ready to make the change. But let this eight minutes of reading challenge you to at least fire off some emails to your analysts and IT guys and run the numbers. Do a little research to see what it would do to your market share if you could move your discounts to online. If they look good, like “get you a promotion” good, then call us, and we can help you figure out the solution that will work for you.

Marci Hansen by Marci Hansen