How to Use Amazon Coupons to Promote Your Products

August 1, 2024
By The Badger

Today we take a journey outside our usual home in the “Campaign Manager” tab in Seller Central and look at a new way to boost your conversions — Amazon coupons.

Amazon coupons are small single-use discounts you can apply to your sponsored products. Having a coupon gives your product a little green badge that indicates savings to a potential customer. These badges signal a good deal to buyers increasing your click-through-rate (CTR) and conversion rates.

Using coupons as a part of your PPC campaign is still a fresh new strategy, so we’re going to break down exactly what you need to know to start rolling in that discount dough.

Here’s what we’ll be covering:

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The Benefits of Amazon Coupons

Now you might be a little skeptical about coupons and asking, “Can I really just add on some coupons and have my sales jump?” Well kind of, yeah!

We recently had Scott Needham, CTO of Buyer Box and Valence Services, on our podcast who answered this exact question.

So for all of our stale inventory, I threw the minimum value coupon on every single one of them, all of the SKUs, and guess what happened? The sales doubled.

Scott Needham

CTO of Buyer Box and Valence Services

So why did these coupons cause Scott’s sales to jump so much? Well as it turns out, buyers just can’t resist coupons.

When buyers see you and your competitor’s products listed right there on the same page with the same price, offering that extra 5-25% off can give you the edge to win their click.

People love the feeling that comes with getting a deal, so by offering a coupon on every single one of his products, Scott was able to capitalize on that behavior.

Does the Actual Coupon Price Make a Difference?

You’d think that offering a 25% discount might result in a bigger benefit than a 5% coupon, but that might not exactly be the case. Coupons all seem to nudge up conversions by about 5 – 10% no matter how big or small the discount is.

This means that the actual deal you’re offering might not be as important as simply offering the deal itself. However, this doesn’t necessarily mean to only use the bare minimum coupon every single time.

We recommend trying out different coupon discounts for different products and track which amounts have the most success. This way you can hone in on the exact discount price that maximizes your conversion gain from coupons.

How to Start Using Amazon Coupons in Seller Central

Luckily, creating coupons is a breeze inside Seller Central, so give it a shot when you’re done reading this guide.

Step 1: In Seller Central, navigate to the “Advertising” tab and select “Coupons” from the drop-down menu.

Step 2: Click “Create your First Coupon” and select between your different ASINs.

Step 3: Select either a percent or dollar discount. Percent discounts must be between 5-80% off.

Step 4: Set your coupon’s maximum budget. Each time you sell an item, this maximum budget will be deducted by the amount of the coupon and a $0.60 coupon referral fee. Once your maximum budget reaches 0, your coupon will automatically be deactivated.

Step 5: Lastly, schedule how long your coupon will last. This can range from 1 day to 3 months.

And just like that, you’ve set up your first Amazon coupon!

Now that you can make coupons, the next step is figuring out which products to apply them to.

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How to Maximize Your Budget and Schedule?

Monitor your coupon budget closely to ensure you’re not overspending.

Adjust the budget based on the performance and sales data of your products. Schedule your coupons during high-traffic periods such as holidays, special events, or sales promotions to significantly increase visibility and conversions.

Start with a smaller discount and gradually increase it based on the product’s performance. Analyze which discount levels are most effective for your different products.

Tailor your coupon schedules around seasonal trends or specific events relevant to your product category, such as offering larger discounts during Black Friday or back-to-school seasons.

Establish clear goals for what you want to achieve with your coupons. Whether it’s clearing out old inventory or boosting the sales of a new product, having specific targets will help you measure success.

What Types of Products Need Coupons?

When it comes down to it, your inventory consists of top sellers and under-performers. So do you slap a coupon on your top sellers to increase their conversion rates from 15% to 20% or do you use them to boost under-performing products?

Well lucky for us, you can use Amazon coupons on your top sellers, your under-performers, and everything in-between.

See the thing is, aside from the margin hit you take from offering coupons, you really don’t lose anything from keeping coupons on all of your products.

You can’t underestimate the value add coupons give from how they make customers feel. Unlike traditional shopping, buyers aren’t checking in every month to see if there’s a coupon or not.

When they do come to your product, having that little green coupon badge and offering that extra bit of savings will always sway people, no matter whether the product is a top seller or a couch potato.

I’m sure at this point you’re convinced that coupons are an effortless way to bump up conversions on all your products, but there is one common pitfall to watch out for.

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What Is the Best Discount Type: Percent or Dollar Off?

Percent discounts provide a percentage off the original price, appealing to buyers who love the idea of saving a specific portion of their purchase. These discounts can be more flexible, allowing you to offer anywhere from 5% to 80% off.

Percent discounts are particularly effective for higher-priced items, where even a small percentage can translate into significant savings.

Why Choose Dollar-Off Discounts?

Dollar-off discounts offer a straightforward monetary reduction, such as $5 off a $50 product. This type of discount is easy for customers to understand and doesn’t require any mental math.

Dollar-off discounts can be more impactful on lower-priced items, where a specific dollar amount feels more substantial compared to a percentage.

Which Type Converts Better?

Studies suggest that dollar-off discounts tend to improve conversions more effectively than percent discounts. This is because the savings are immediately clear to customers.

For example, a $10 off discount on a $50 product is more compelling than a 20% off discount, even though they offer the same savings.

When to Use Each Type?

Use percent discounts for higher-priced items to highlight the significant savings percentage.

Opt for dollar-off discounts for lower-priced items to provide a clear, attractive savings amount.

Testing both types on different products can help determine which works best for your specific inventory.

How to Measure the Success of Your Coupons?

Measuring the success of your Amazon coupons involves tracking key performance indicators (KPIs) and analyzing the impact on your sales and conversions.

Start by monitoring your click-through rate (CTR) to see if the coupons are attracting more customers to your product listings. A higher CTR indicates that the coupon is effectively drawing interest.

Next, evaluate your conversion rate, which shows how many of those clicks turn into actual purchases. A significant increase in conversion rate after implementing coupons suggests that the discounts are persuading customers to buy.

Another crucial metric is the total sales volume. Compare your sales before and after adding coupons to see if there is a noticeable rise. Additionally, track the average order value (AOV) to determine if customers are spending more overall due to the coupons.

It’s also important to calculate the return on investment (ROI) of your coupon campaigns. Subtract the total cost of the discounts and any associated fees from the additional revenue generated, then divide by the cost. This will give you a clear picture of the profitability of your coupon strategy.

Lastly, pay attention to customer feedback and reviews.

Positive comments about the value of the deals can reinforce the effectiveness of your coupons and help refine future promotions.

How to Integrate Coupons into Your PPC Campaign?

Integrating coupons into your PPC campaign can significantly boost visibility, attract more clicks, and increase conversions.

Start by selecting the right products that will benefit most from coupons. This can include top sellers to enhance their performance, under-performers to give them a sales lift, or seasonal items to clear out inventory.

Create compelling coupon offers, choosing between percentage discounts and dollar-off deals based on your product prices and target audience. Ensure the discount is enticing enough to grab attention while maintaining your profit margins.

Incorporate mentions of your coupons in your PPC ad copy with phrases like “Save 20% with Coupon” or “$10 Off with Amazon Coupon” to make your ad more appealing.

This not only attracts clicks but also informs potential customers about the savings upfront. Amazon’s coupon badges are eye-catching and automatically appear on sponsored product ads when you have an active coupon, signaling a deal to shoppers.

Allocate a portion of your PPC budget to ads with coupons and monitor their performance, adjusting your budget to maximize ROI. Track key metrics like click-through rate (CTR), conversion rate, and return on ad spend (ROAS) for your PPC campaigns with coupons.

Continuously test different coupon values, durations, and ad copies to find the most effective combination.

A/B testing can help identify what resonates best with your audience and drives the most sales.

How to Adjust Coupon Strategies Based on Product Performance?

To maximize your coupon strategies, start by analyzing the performance data of your products. Identify which products are top sellers, under-performers, or have seasonal sales patterns.

For top-selling products, use smaller discounts to maintain high profit margins while still attracting additional buyers. Even a small discount can boost a top seller’s rankings. Monitor how these discounts impact your sales and conversion rates.

For under-performing products, implement larger discounts to generate interest and clear out inventory. Track the performance to see if the larger discount increases sales and if it justifies the reduced profit margins.

Seasonal products benefit from timed coupons that align with peak buying periods. Use historical sales data to predict when these peaks occur and schedule your coupons accordingly. This maximizes the relevance and impact of your discounts.

Consider combining coupons with other promotional strategies, such as bundling products or offering free shipping, to enhance the perceived value. Integrating various tactics creates compelling offers that drive more sales.

Common Pitfalls

One of the most common pitfalls comes from the choice of selecting a percent or dollar coupon. There’s nothing wrong with percent coupons, but the data suggests that dollar coupons improve conversions more.

When you think about it, this actually makes sense. For example, giving a 15% discount on a $48 product might seem fine in theory, but how much is the actual discount? People don’t like to do this kind of math when they’re simultaneously trying to decide if they even like the product or not.

In contrast, simply stating a dollar amount of $7 in savings would be a lot simpler and save everyone the trouble of trying to compute percentage savings on the fly.

Key Takeaways for Amazon Coupons

As you continue to build up your PPC campaigns with Sponsored Product Ads, Sponsored Brand Ads, Retargeting and more, it’s good to find a simple and direct value add in coupons.

If you’re ready to start increasing your conversion rates, then head on over to Seller Central and start churning out those coupons. Badger out.

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