Unit 13.1 Principal of Social Media Advertising and Promotion

Currently digital vouchers are quite popular. In the past times people used paper vouchers which still exist but using digital vouchers is faster and easier. More and more people use smartphones to do almost everything there so it is good to create digital vouchers and put them online. Like I said it easy and fast to find and use it. Of course like everything in our world has advantages and disadvantages but about it you can read lower. The most important thing associated with digital vouchers is to create really good campaign.

1.1 Define the term digital vouchers.

In accordance to businessdictionary digital vouchers are available online for electronic orders that are also available to download and print for redemption in person. Digital coupons are available on company websites, social media outlets, texts, and email alerts. There are an increasing number of mobile phone applications offering digital coupons for direct use.

1.2 Explain the potential uses of digital vouchers.

Megan Byrne from the megansocialmedia writes that digital vouchers could be used to promote a product but offering money off. They can also be used to promote deals of the day. This is a good way to promote different products.Also you could use tickets or discounted gift certificates by delivered through web or via email. Digital vouchers are a good way to increase brand awareness. RetailMeNot said that ‘on average, consumers will spend 2 hours a week dedicated to hunting for deals online.’ You could also encourage social sharing of vouchers. This could be like a student discount code. By sharing these vouchers this could encourage more people use your products or services. RetailMeNot said that ‘40% of consumers will share an email offer with their friend and 28% of consumers will share deals via social media platforms’.

1.3 Research the current disadvantages of digital vouchers.

Disadvantages of Using Coupons

Risk on Brand Iimage

On the galido we read that discount codes may have a negative impact of your brand image. Discount coupons may make your company look cheap. The risk is bigger to luxury brands such as Gtech. One way to counteract the risk of damaging your brand is to maintain the price of the core product as is, while offering coupons on the extra items. Gtech discount codes, for example, give you free shipping within the UK. When the company offer shipping for free, there is no discount on the main product.

Risk of Making a Loss

Discount codes might prove to be costly and end up reducing your profit margins. The only way to skirt this issue is by knowing what you can reasonably afford to discount. Sometimes, your product might not carry the margin required to provide a coupon. For instance, if Gtech’s cleaners sell for £199 and it costs the company £100 to pay the manufacturer, plus £50 in marketing and operating costs per unit, then issuing 25% off Gtech codes would mean that the company makes a loss.

Reduced Revenue

If you give a discount to all clients, even to those who would still buy at full price, you effectively reduce profits from all sales. A good way to market coupons is to offer them to new customers, or to select customers on special occasions.

For example, using social media, you can connect personally with potential clients and offer them generous discounts via Messenger on their birthday. Alternatively, you can wish them happy birthday on their Timeline together with a coupon or link to a special offer. This is even better than Messenger because other people get to see the offer and your brand.

According to investopedia.com the biggest con of using coupons is that they cost you money. Any discount you offer will mean less money in your pocket. The key is to calculate whether that discount will make a difference to your profit margin by introducing new customers to your store or bringing back old customers who may have gone elsewhere chasing other coupons. Jay Goltz, in the New York Times column, “Doing the Math on a Groupon Deal,” developed a method to calculate whether or not a coupon discount is worth it for your business.

Even your regular customers can get in the habit of waiting for coupons, which cannibalizes income that was already being generated before you introduced the coupon program. So you need to consider when and how to offer those coupons to avoid impacting your regular customer base.

Coupons will always result in reduced profits on the item or items included in the coupon campaign, but the cost of purchasing that product will not change. When considering the value of a coupon campaign to your business, you must find a way to determine if the discount will end up improving your bottom line in the long term. We talk more about how to use a coupon campaign strategically to grow your business below.

1.4 Explain how to overcome the barriers of using digital vouchers for acquisition and retention of customers.

Megan Byrne claims writes also about process for customer retention. According to the Harvard Business School, increasing customer retention rates by 5 percent increases profits by 25 percent to 95 percent. I think a good way for customer retention is communication, this could be email updates with new stock or promotions. The next point in the process is selling. If customers had a good buying process with you, for example when I brought a new car the company gave me constant updates via email and phone and all the staff were really friendly and helpful, customers will most likely will use your company or products again. Also by offering good customer service, this could attract new customers via the word of mouth.I think the next point of customer retention is support. This could be by answering customer queries or complaints quickly and effectively. Another way to overcome the barriers would be by offering your customers incentives. For example, you could run competitions on your social media pages to encourage engagement and gain more brand awareness as well as getting customers involved. Another incentive could be using photos or reviews from your customers, you could do this by post asking customers to post pictures of them using your product and that your company can then share. A further example would be giveaways. You could run a giveaway campaign by using your social media accounts as a way to enter. You can offer brand special exclusive deals. For example, Dominos post a variety of discounts and vouchers to local areas to encourage people to buy their products. Another example would be loyalty cards. Big companies such as Starbucks, Costa, Subway and Morrisons offer there customers points cards so after a certain amount of purchases they get a reward. According to RetailMeNot ’91% of coupon redeemers have said they will purchase from a retailer again’.

1.5 Plan a SMART digital voucher campaign for a business.

Specific – Digital voucher campaign is going to be for clothes shop. We should run a voucher code on our online shop and social media accounts. If people use this voucher they will have 15% off.Measurable – To raise sale by 10%.Achievable – I think this is a very achievable goal because people have an opportunity to buy what they want but they can pay less for it. In summary is it possible they will buy more products from our store.Relevant – This is a good goal to gain more customers eventually resulting in a profit.Timely – This campaign will run throughout the month of May and will end on the 31st May.

1.6 Explain methods of managing a digital voucher system.

Companies are typically using a variety of tools to manage very basic coupon campaigns. But these tools that provide an “out of the box solution” have certain limitations when it comes to the actual integration with your system.

On the other hand, companies tend to try and build some kind of solution in-house. I call this the Promotion Dilemma – marketers waste their promotional budget by creating ineffective campaigns, and developers defocus because of ongoing campaign requests from marketers and tool maintenance. Tools developed in house are expensive and have limitations in functionality, scalability and flexibility.

In my experience, your business might be focused on coupon codes today, but tomorrow your promotional marketing requirements will change. In future you will have more complex use cases with a variety of validation requirements or even referral and loyalty program requirements.

If you are a marketer that is serious about scaling your business, avoid limiting yourself to a single tool or software which in itself limits you to a small number of very specific use cases.

1.7 Explain how to measure the effectiveness of a digital vouchers campaign.

Jessica Athorn describes two ways of measure the effectiveness of a digital vouchers campaign.

1 – On most social media networking sites, you see the analytics of how much engagement you are getting over a certain period of time so this could be used to track how much you are improving engagement since the start of the campaign.

2 – Another way to measure the effectiveness of the campaign could be to simply see if your sales have increased since starting the campaign as this would be a clear indicator of if the campaign is working or not.

Conclusion

So now we know what digital vouchers are. Is it good to use it now because majority of people use smartphones and this number will raise in the future. The most important things about digital vouchers are: fast and easy. Of course we should plan a really good campaign. If we want to have a expensive shop or service we should consider of using digital vouchers because when people think about digital vouchers they think about something cheap. Then we can manage whole campaign manually or by special tools or we cane hire a specialist for it. Everything depends on us.

References:

http://www.businessdictionary.com/definition/digital-coupon.html – accessed on 01.02.19

http://megansocialmedia.blogspot.com/2016/06/unit-308-principles-of-social-media.html – accessed on 01.02.19

https://galido.net/blog/advantages-and-disadvantages-of-using-coupon-codes/ – accessed on 01.02.19

https://www.investopedia.com/articles/personal-finance/051815/pros-cons-using-coupons-your-business.asp – accessed on 01.02.19

https://jessicaathornapprentice.wordpress.com/2017/04/26/unit-308-task-b/ – accessed on 01.02.19