Marketers have widely used coupons as a promotional strategy in many consumer products categories. In a difficult economic environment, consumers have increased their usage of coupons as a cost-saving measure in the last few years.

Discount plays an important role in the consumer’s life by helping them to decide where to shop. Students love the most deals and coupons, especially student discounts. When brands offer student discounts it makes a big difference in college students purchasing decisions. This is an effective technique for maintaining existing customers and encouraging customers to revisit their brand/store.

Most people think about how discounts affect sales. Discount has been used to increase sales. 64% of online consumers wait for the items to go on sale. 59% of online shoppers search for coupons before buying anything although 22% of consumers shop from their favorite brand only when they’re at the sale price because discounts influence the price on consumer behavior.

As we all know discounts affect consumers’ psychology and this has not changed as we move into an era of incredible ease and automation. The coupon usage ratio has increased. Australia has the best coupon websites that offer different coupon offers for customers. Especially youngsters like to avail of digital coupon redemption. Here are the most important facts about coupon usage:

The Online Coupon Redemption Ration has Increased

• 62% of online women pay attention to deals and discounts whereas 57% of online men shoppers do.
• In 2020, 92% of online shoppers look for a coupon before completing their purchase.
• In 2022, it was estimated that digital coupon redemption will reach $90 billion.
• 30.6% of women internet users use discounts day to day shopping including digital shopping and restaurants. On the other hand, 16.8% of men.
• In 2020,  a reported 86% of Millennials showed that a discount can persuade them to switch brands.
• It is predicted that 80% and more discount redemption will occur through mobile phones in 2022. These statistics show how much effect discounts have on consumers.

How Discounts Affect Consumer Lifestyle

Discounts have existed for centuries, and the effects of discounts on the consumer are increasing day by day. They have successfully navigated the digital age, potentially becoming more important than ever.

Here are some examples of the effects of discounts on consumers:

1.  Discount Makes People Happy

According to a Claremont Graduate University study, saving money always makes people happier. When you offer your customers a chance to save more money than the product’s perceived value, their oxytocin levels rise and you will see the effects of a discount on the consumer.

This is a great way to build a positive relationship with the brand when customers recall it later, as they will associate with a great vibe they experienced with your business.

2.  Encourage Consumers to Purchase Instantly

Discounts encourage consumers to buy sooner. This is due to the concept of scarcity,  in which customers recognize that discounts aren’t constantly available to help them save money.

Furthermore, according to Psychology Today, “anticipatory regret” (regret about missing out on a good deal) is a major source of urgency when it comes to promotions. Urgency is a key factor in getting customers to buy and it may be enhanced by using specific wording in your marketing communications.

3.  Reduce Desire to Shop Around

According to studies, offering a coupon or discount can discourage customers from looking for the same product elsewhere. This is due to the fact that discounts generate a sense of urgency to buy, which diverts buyers’ attention away from other options.

If the discount deal is appealing and easily accessible, the buyer is more likely to take advantage of it and complete the purchase.

4.  Building the Consumer’s Trust

Consumers have a strong belief that a discount offered by a brand has a genuine reduction from the original price. Shoppers rarely expect dishonesty, instead of assuming that the discounts offered are genuine and represent a good offer with good faith.  Offering actual reduction helps to create a sense of comfort, trust, and confidence and encourages consumer loyalty.

Types of Discounts and How they Work

You got an idea of how discounts factors affect customer behavior. Now you can start planning how discounts can be beneficial for you. But before you start planning you should know about different types of discounts. Some are mentioned below:

1.  Buy Now Pay Later

You’ve probably seen the enticing “buy now, pay later” (BNPL) offers from retailers and apps, which allow you to spread the cost of purchases over four equal installments, typically without paying interest. A lot of people, even 42% of the American consumer have availed BNPL service.

2.   Discount in Dollars or Percentages

This is the most common and running type of discount which simply offers a reduction in the original price like 20%, 25%, or 50%. You can get that discount on a specific product or on a full order. This simply shows the effect of a price discount on consumer buying behavior.

3.  Free Shipping Offers

Free shipping is becoming popular among online business owners because it cuts the whole shipping cost associated with any order from the customers. To offset costs, several retailers provide free shipping on orders over a specific amount, such as $49.

4.  Buy One Get One

This discount type, “Buy One, Get One,” encourages buyers to purchase additional things in order to qualify for the offer. Some stores offer “Buy One, Get One Free” and some offer “Buy One, Get 50% Off the Next Item”. This highlights the positive effect of discounts on the consumers

5.  Refund Policy

A refund policy works as an amount is returned or refunded to consumers after their purchase. The most popular form of refund is a mail-in rebate, which is frequently utilized for large-ticket products. Suppose listing a price as “$349.99 after rebate”.

6.  Student Discount

Some stores have a special advantage for students, they offer a “Student Discount” for the students who enrolled in college. This offer becomes popular among the stores because students get excited when it comes to shopping. Stores find out a great way to entertain the students by fulfilling their needs.

Why do Customers Like Promotions

Obviously, you can see the impact of sales promotion on consumer purchasing behavior. People get a lot of benefits by availing of promotions. Discounts give options to customers to get products that look too expensive and they can’t buy at full price. To avail of the coupon doesn’t mean that you buy products of low quality, it means you buy the same product at a lower price.

Some discounts give a wholesale price which motivates customers to buy things in bulk. You can save more money by purchasing items per piece. From the saved money you will have a chance to get another item. If you get 10% off on every item, this is a good saving, especially on expensive items.

Wrap up

The above data indicates clearly the effects of discounts on the consumer. Consumers now have more power at their fingertips than ever before because of technological advancement and the competition that increases with it. When it comes to a great deal, their very humanness still responds to the same psychological triggers.

Simply businesses should adapt the way they deliver their discounts, and improve their digital consumer experiences to incorporate quick access to online coupon savings.