Deal-hunting is no longer the province of cost-conscious consumers – it’s a universal shopping behavior. All income levels of customers are spending more time looking for the best deal. But for most, it’s not always the biggest discount that catches their eye. Accessibility and convenience are just as important.
Building a digital coupon strategy that looks beyond simple discounts is the key to capitalizing on this trend. It helps you connect with customers and create precision-targeted campaigns that drive loyalty. Here’s how.

What is a Digital Coupon Strategy?

A digital coupon strategy is a targeted approach to offering discounts and deals through digital platforms. Also known as digital coupon marketing, it allows you to attract new customers, boost sales, and build loyalty. Unlike traditional paper coupons, digital offers allow shoppers to redeem incentives through multiple channels.

Digital Coupon Redemption Methods
Scannable Barcodes
A unique barcode they can present at checkout for scanning. The discount is applied right away, making the customer’s experience a breeze. Receipt Submission
To receive cashback or rewards, the customer makes a qualifying purchase and then submits their receipt via your receipt validation platform. It’s particularly useful if you want to verify purchases across any retailer where you sell your products, without requiring retailer integration.
Code Submission
Shoppers enter a code during checkout on a website or app to receive their discount. You can distribute these codes via email, SMS, social media, or a dedicated promotional web page, making them perfect for omnichannel campaigns.
Universal Barcode
Universal bar codes are digital codes which customers can redeem across participating retailers, making them more flexible than standard scannable barcodes. This creates a more standardized approach to coupon redemption.
Types of Coupon/Offer
Digital offers and coupons come in many shapes and sizes. The top four are:
Percentage Off
Offering a specific percentage discount off the total purchase or selected items. 67% of consumers prefer percentage-off coupons over other formats, according to industry research.
Fixed Discount
Deducting a specific dollar amount from the purchase. This approach works well for high-value items where a percentage might seem insignificant or for strategic price points.
Buy One, Get One Free (BOGO)
Customers receive a free or discounted second item when purchasing another at full price. BOGO offers are particularly effective at driving sales volume and product trials.
Free Shipping
This coupon eliminates shipping costs for online purchases. 57% of consumers prioritize free shipping coupons, which makes this incentive particularly effective at reducing cart abandonment.

9 Steps to Building Digital Coupon Strategy

1. Define Your Goals

Start by identifying what you want your coupon marketing strategy to achieve. Without well-defined objectives, you risk creating scattered promotions that drain your budget without delivering measurable returns.
Your goals should directly connect to broader business priorities. Are you launching a new product? Looking to increase purchase frequency among occasional buyers? Each of these objectives requires a different approach.
Common objectives include:
promoting product trials Increasing purchase frequency
Building basket size and volume
Acquiring new customers
Strengthening customer loyalty
Collecting customer data for future targeting

2. Establish Your Target Audience

Setting goals for your program is just as important as determining your target audience. Understanding your audience helps tailor your offers to their preferences and behaviors.
Do you want to target:
Who might be new customers? Do you want to keep your current customers or upsell to them? High-value customers you want to reward?
Do you want to reconnect with lapsed customers?

3. Choose Your Offer Type

Finding the right offer depends on two things: your target audience and your objectives. For example, if you want to increase new product trials, consider a BOGO offer with your best sellers. If you want to build strengthen relationships with existing customers, consider offering personalized discounts to loyalty program members.

4. Set Your Offer Rules

Your terms and conditions form the foundation of your digital offer. They outline the parameters customers must adhere to, including:
Offer start and end dates
Eligibility criteria
Qualifying products
Limits on redemption Setting clear parameters helps you prevent promo abuse, maximize your return on investment, and comply with relevant laws.

5. Select Your Redemption Methods

Choose redemption options that offer a balance of convenience and security. Scannable barcodes and receipt-based redemption methods are ideal for in-store purchases, while digital codes best suit e-commerce transactions.

The most successful programs often employ multiple redemption methods to accommodate different shopping behaviors and channels. The key is making redemption as frictionless as possible. When coupons are easy to redeem, consumers are more likely to use them and return for future purchases.

6. Pick Your Distribution Channels

Determine the most effective way to get your digital coupon strategy in front of your target audience. Typically, this should leverage a combination of your paid, owned, and earned media channels, including:
Email
Mobile apps
SMS
Social media
Brand website
Program microsites
Networks of financial media

7. Implement Participation Tracking and Fraud Prevention

Implement robust systems to monitor participation and prevent coupon abuse. Dedicated digital coupon management platforms include sophisticated fraud prevention features that significantly reduce the risk of coupon misuse compared to traditional paper coupons.
They let you:
Monitor the patterns of user engagement and redemption. Establish single-use verification for codes
Employ AI and machine learning to detect suspicious activity
To prevent duplicate submissions, digital fingerprints should be created for transactions. Implement two-factor authentication for high-value offers

8. Monitor and Analyze Performance

Digital coupons are a great source of customer data. With an end-to-end coupon management platform, you can consolidate insights in one place to measure program performance over time. For example:
Track redemption rates by channel, offer type, and customer segment
Examine how the program affects customer lifetime value, purchase frequency, and the size of the basket. Measure incremental sales versus discount costs
Compare performance across different retailers and regions
Evaluate customer acquisition costs for new shopper programs

9. Refine Your Approach

With a reliable source of consumer insights at your fingertips, you can optimize your coupon marketing strategy to appeal to your audience.

Think:
Testing different offer values, messaging, and creative elements
Adjusting targeting parameters based on response data
Optimizing timing and frequency of coupon distribution
Refining the user experience to reduce friction and increase redemption
Scaling successful tactics while phasing out underperforming ones
Continuous refinement ensures it remains effective as market conditions change, new trends emerge, and consumer behaviors evolve.

Objectives and Benefits of a Digital Coupon Strategy

A well-executed coupon marketing strategy helps you:

Drive Sales and Volume

Research suggests digital coupons increase consumer spending by up to 24%, with retailers reporting up to 50% higher conversion rates.

Attract New Customers

61% of consumers say coupons and discounts inspire them to try a new brand, making them powerful customer acquisition tools.

Build Loyalty

Personalized offers based on purchase history strengthen customer relationships. Nearly half of all U.S. consumers list discounts as their favorite kind of personalized offer.
Enhance the Program’s Efficiency Digital coupons eliminate printing, distribution, and handling costs associated with paper coupons while providing superior tracking capabilities.
Eliminate Fraud Coupon management platforms offer sophisticated fraud prevention features that reduce misuse compared to traditional paper coupons.