Creating an effective promotion code strategy can seem like a daunting task.
You have to decide when the promotion code is going to run, how much you are going to discount with the code, and how many products you want to put up for the sale. You have to know how much revenue you could gain (or lose) by using the promotion code, how many people actually use the code, and how many promotion codes you want to release in a typical year.
It’s a lot to think about, and if you’ve never developed a promotion code strategy you may not know where to start.
We just released our new Facebook shop promotion code feature and this post is designed to help you decide which promotion code discount is best for your business and for boosting your Facebook store sales.
First, it’s important to define the purpose of your promotion code campaign
There are a number of different goals you could have for creating a promotion code, and here are some of the most popular.
1. Increase short-term sales
2. Promotion of new items
3. Move old inventory
4. Reward loyal customers
5. Gain an advantage over competition
Even though 73% of online shoppers will search for discounts or promotions before they make a purchase online, it’s important to have a goal in mind before you develop your campaign. If you want to increase short-term sales, you’ll likely want to run a time-based campaign. If you just want to reward loyal customers, you’ll want to reach out to those who have already made a purchase with the code via email or Facebook message.
If you want more specific ideas about how to communicate your promotion code to your customers, take a look at our article on Facebook shop promotion code ideas.
When you have a goal in mind, you can decide what type of discount you want to offer.
If you’re trying to move old inventory, larger discount codes (e.g. 40%) are typically used. For new products, you’ll want to start with something smaller like 10-15%. Always start with smaller discounts and then increase them if you find that they aren’t effective at increasing sales.
Timed offers should be tested for all discount sizes. Creating a sense of urgency is one of the most effective ways to increase short-term sales.
Quick tip: Showing the original price of a product when you’re promoting your discount can be an effective way to communicate the value of the promotion code. For instance, “Original price $20 – now only $16!”
Always experiment with new discounts and strategies.
Don’t jump into large discounts right out of the gate. Sometimes lower prices can signal lower quality. Start with a set of prices and then make adjustments with promotion codes if you aren’t seeing enough sales.
If you start to use promotion codes frequently, your customers may start to expect discounts for everything. If this is part of your strategy, great, but if not you’ll want to be weary of discounting too frequently.
Ready to set up your first Facebook shop promotion code? Here’s a guide to get your started.