When a coupon is not the coupon you want to be handing out to customers

I caught up with a client last week, whose eCommerce website we have recently redeveloped.

Things are going well in terms of sales and improvement; what was most interesting and impressive however, was the grasp the client had of its analytics: what was working and not working, and basically the numbers underpinning the website.

The reason I say my client’s grasp of his analytics was impressive, is because so few businesses pay attention to their analytics, have the right analytics or grow their businesses through analytics.

This is a genuine loss and you really are flying blind and missing big opportunities without using analytics to drive your eCommerce website, though that is a blog for a different time.

Instead, this blog is about a very simple and very interesting finding my client had from an EDM (Electronic Direct Marketing) sent to some of his customers.

As a background, my client is doing really well. Too well.

They are massively oversold on a particularly product.

Because of the nature of the business and the product, products sold through the website are not sold with the stock rules that most eCommerce websites must abide by; that is, don’t sell stock you don’t have.

If my client oversells, they reorder and generally get stock within a reasonable period; their products are also unique to them and are also pretty exciting products so unlike where someone might cancel a delayed computer RAM order, my client's product is different.

People want the product and their want of the product doesn’t overtly wane with a delay in delivery.

(Good position to be in!)

So with too many orders to immediately fulfil, my client sends one of two emails to customers with delayed orders: 50% of the first email to the first group of users, the other 50% to the other group of users.

In the first email, apologies are made to customers with promises of further communication when the product is in stock.

In the second email, the same apologies are made except that customers are additionally given a coupon code entitling them to 20% their next order.

And here’s the thing…

The second email with the coupon code sees three times the cancellations of orders when compared to the first email.

My initial conclusion was that users were offended by the gesture or suggestion that they would order again from a website that had already delayed a previous order they had paid for.

This wasn’t the case however.

Instead, the customers holding an email with a coupon code cancelled their orders and reordered the same product with a 20% discount.

Something that never crossed my mind.

We often run focus groups and tests for our clients and their websites and the users (people) we interview never cease to amaze me; they see things so differently to how we as web designers see things.

We read into one thing, they see another.

My client’s lesson was relatively inexpensive though pretty useful; putting aside the later purchasing intentions of customers (something only analytics will tell you), sending customers a coupon code when their product is delayed will see an increase in cancellations reorders at a discounted price.

The lesson for the rest of us?

Well obviously, don’t send customers with delayed orders a coupon code (though back this up with analytics) ; more importantly, do not assume your users think like you.

They’re much smarter.