How discount codes affect checkout conversion rate

Should you be offering your customers discount codes? How does this affect customers without one? 5 test ideas for your checkout to run NOW!

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Browser Media recently conducted a piece of market research into attitudes towards using discount and voucher codes.

We found that 4 out of 5 UK adults have used a discount or voucher code in the last 12 months. We also found that 13% of those users get nervous when shopping online if they can’t apply their code until right at the end of the checkout process. A nervous customer is less likely to complete the checkout process, and so those anxieties need to be addressed. The most obvious way to do so would be to let users add the code earlier in the checkout process, but studies show users are put off purchasing if they are presented with a coupon box but don’t have a code – so what are your options?

Picture the scenario: You’re browsing online, you’ve found the perfect pay-day treat for yourself, and you’re sailing through the user journey, headed for the checkout. You get to the cart, tot-up the cost of your spree, including the shipping or delivery, and then you’re presented with the big, fat discount code box:

homebase discount box example
Discount Code Box c/o Homebase

Thing is, you don’t have a discount code. Quicker than you can say Ctrl T, you’re off searching for one – why should someone else get a discount and not you?

Now imagine your customers are applying the same logic. Just having a voucher code field present on your shopping basket could have them questioning value for money. A study conducted by PayPal and comScore actually found that 27% of participants would abandon their cart to search for a discount code.

If that happens, you’re then faced with a whole other set of problems. If your would-be customer stumbles on a voucher code site containing an out-of-date voucher code, you’re increasing the risk of them getting sidetracked, frustrated and then leaving. You’re also potentially exposing them to your competitors’ codes. Before you know it, you’ve lost them. Hello Cart Abandonment.

How can you cater for the customers with a code who are worried they might not get to apply it, as well as the customers without a code who are just as likely to want a bargain?

1. Stop using discount codes

While this could eliminate the problem entirely, studies show that customer satisfaction increases by 4% when they use a code.

2. Pre-discounted links

Jacob Nielsen recommends avoiding discount codes and vouchers all together in favour of using a specific url from an email to apply the code automatically and save it to a user’s session. That way, you don’t need a discount code box at all.

3. Hide the box if there is no code

Similarly, that url-specific link from an e-shot or affiliate site could include a parameter that stores a code in the customer’s session so that when they get to the checkout page, the box appears. That way, the customer still gets the satisfaction of entering the code manually.

4. Link to your own voucher page

Do as Macy’s did and keep customers on your site by hosting valid codes on a dedicated page. This means they’re more likely to stay on your website, and less likely to be tempted by a competitor.

5. Swap the box for a link

… And consider your wording. A big, colourful box adorned with “Apply Your Discount Code” is ideal for customers with a code, but we’re back to risking putting off those without. How about a simple link using synonyms such as “vouchers” or “gift cards”? Amazon provide a good, more subtle example:

amazon gift voucher example

Thing is…

Even if you find the ultimate combination of (in)visible boxes, links and wording, you’re still presented with a quandary regarding when you give customers the opportunity to add that code. On the whole, the more steps of the checkout process a customer has completed, the more committed they are to buying a product. With that in mind, giving the option to add a code towards the end of this process is less likely to put off those without one. Customers with a code will wait to add it, but you could always pacify that nervy 13% with a reassuring “You can use your code when you add your shipping address”.

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