Because the cost to acquire a new customer is much higher than keeping an existing customer, and for many sites new visitors make up over half of all traffic — offering incentives to new customers makes sense.
For example, Organize.com has used a pop-up coupon for first time visitors, offering $5 off if you buy something during your visit (not on your subsequent visit).
Here’s another offer for first time visitors (I used a different browser):
Whether these pop-up incentives are a turn-on or a turn-off for your customers is something you’ll have to test.
A few things to keep in mind if you explore this method of first-time-visitor personalization:
Should You Address “First Time Visitors” as Such?
Visitors that use different computers, browsers or who regularly clear cookies will show up as new visitors even if they’ve been to your site before. Same goes for visitors who visited some time ago whose cookies have expired. When these customers repeatedly see “Welcome first time visitor!” – what does that do to your brand? Does it become spammy?
And because offering discounts to first time visitors is technically price descrimination, it might put off some who think “What about us returning customers? Are we chopped liver?” You can still offer discounts without mentioning “first time visitor” as Organize.com does in the second example.
Incentives are No Substitute for A Clear Value Proposition
If you’re going to use pop-ups, why not split test an incentive vs. a clear one-sentence explanation of why the customer should buy from you and nobody else? Give the first time visitor a compelling reason to stay — especially when customers can easily find coupon codes in search engines for you or any of your competitors.
Don’t forget, it’s important that your UVP/USP (unique value proposition AKA unique selling proposition) is clear on your website for all visitors.
Deliver What You Promise
Test your coupons often to make sure the process works. The worst thing you can do is “forget” to apply or honor the coupon code at checkout. First time visitors are far less likely to ever return if they perceive they’ve been deceived.
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“Incentives are No Substitute for A Clear Value Proposition”
That statement is dead on. We a/b tested a similar scenario at C28, and found little benefit from the coupons for first time visitors. My guess was that we were jumping to the conclusion that customers would buy with a discount, when we should have been better defining the UVP of the site first.
Been doing this for a while now – we offer £5 off if you sign up for the newsletter. The popup only appears once, after the user has been viewing a product for 10 seconds. It works an absolute treat, far better than I would’ve thought. I got the idea from ProBlogger, who said they used it and their subscriber numbers went through the roof.
Love this: Incentives are No Substitute for A Clear Value Proposition
I wonder though, if a visitor who didn’t originally purchase but has since returned to the site would convert more often with a coupon offer than a first-timer?
This whole coupon thing throws me when I’m considering my own retail site (a toy store). Your post about “how much do your coupons cost you” hit home…I’ve been dealing with a coupon site who became an affiliate without my realizing what the implication of that was. I finally discontinued all of their coupons, so that now they just have an affiliate relationship.
I think I’m going to have to take time to develop a coupon add-on that will handle coupons on a special page instead of presenting it during checkout.
Linda what is your experience with the sites you work on for clients? Do most of them offer coupons? Do most of them NOT put the coupon box into the checkout stream?
@Justin and @Neil, thanks for sharing your experiences. Goes to show that there’s no “best practice” – it’s a matter of testing to see whether something works for your site and your customers.
@Craig, you bring up an interesting point that returning visitors are also a segment you can target with triggered promotions.
@Susan, I’m not involved in marketing for Elastic Path software customers but I do know of at least one that uses the promo code lookup approach – only showing a promo box when referred from an affiliate offer or email with promo code. Another of our customers has a promo code banner on the site and would actually like people to use that in the checkout.
The problem is some customers don’t notice the promo in the banner (must test some new approaches to banners etc) and don’t use it. Some end up calling customer service when they find out they could have had free shipping over $100. So this customer is going to start auto-applying the coupon based on the cart total.
Judging from my travels around the web looking at a ton of e-stores, I most often find a coupon code box there though I have no coupon code. So my assumption is most retailers don’t do the p-code lookup.
How I would always do it is to only show the promo box when the referral indicates the customer has a code. I know there are caveats with this approach but I don’t want customers Googling “site + coupon code” and making me discount AND pay an affiliate, as I have blogged about before
Plimus offers this service as an added bonus to its Ecommerce platform. Our expereince has shown that when customers are presented with these features, there is more of an incentive to proceed with the sale. There are also several alternatives to coupons. You can visit this page to find out more about those options: http://home.plimus.com/ecommerce/about-us.
I reckon a small, non-intrusive ‘pop-up’ (like those chat boxes certain sites use) to give new users a discount voucher would work well.