Practical Ecommerce

Conversion Tip: Reduce Abandonment by Publishing Voucher Codes

Editor’s Note: We continue our “Conversion Tip” series from Charles Nicholls, the founder and chief strategy officer of SeeWhy, a conversion and abandonment-recovery firm. For this week’s installment, Nicholls addresses consumers who abandon shopping carts to search for coupon codes.

The widespread nature of discount voucher and coupon sites is encouraging visitors to abandon purchases to look for voucher codes. In response, Macy’s, for example, now publishes its own “special offer” site that lists Macy’s own voucher and coupon codes.

Online deals and promotions on Macy's website.

Online deals and promotions on Macy’s website.

By creating its own voucher site, called “Online Deals and Promotions,” Macy’s not only avoids the affiliate fees of aggregate coupon sites, but also keeps control of its own promotions. Macy’s has presumably found that any additional discounts that are given by its own “Online Deals and Promotions” will be offset by a reduction in affiliate fees or, in Macy’s case, a payment from the manufacturers.

What’s interesting is that 40 percent of Macy’s voucher-code-page visitors go on to convert and become customers. It’s effective because it recognizes that customer behavior has changed: If visitors are searching for coupons and vouchers online, why not keep them on the site and make it easy for them to complete their purchase as planned?


Charles Nicholls

Charles Nicholls

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Comments ( 6 )

  1. Andrew August 27, 2010 Reply

    This is cool, plain and simple. Great article Charles, this is news to share with merchants trying to capture more sales in Q4.

  2. Manish Chowdhary August 27, 2010 Reply

    Coupons and discounts can hurt a website just as much as they can help. Yes, sales may be up but is Macys really acquiring profitable customers using this approach? I doubt it. Retailers are scrambling to make revenue forecasts at any cost and hence such rampant discounting going on with more to come in Q4. When you see sites like Gap advertising nationwide with 50% discount on GroupOn, one needs to think why! Does Gap really want to dilute it’s brand and appeal to just bargain hunters? In that case, why not use Old Navy brand instead?

  3. Chris Hedick August 31, 2010 Reply

    @manish I would tend to agree with you for commodity items like books or CDs. Since a CD is the same no matter where you buy it the only thing that matters is price. But for clothing e-com is different. Copy matters, suggestions and preferences matter, product images matter. I say, bring them in with a discount, have a well designed site and they’ll be loyal if the experience is a good one.

  4. Steve @Erraticblog August 31, 2010 Reply

    Very interesting Charles, I had never thought about this approach before.

    I don’t think affiliates would like it much.

  5. Charles Nicholls September 2, 2010 Reply

    Hi Manish

    Thanks for your comment. In many ways I agree with you about the treadmill of discounts, promotions and offers that many companies find themselves on. Recruiting the ‘wrong type of customer’ with promotions has never been a recipe for long term profitability. But we are now entering the ‘silly season’ in the run up to Black Friday in difficult economic times, so frankly, all bets are off..

    Holiday 2009 was very telling: between 2nd week in September and the 2nd week in November, ecommerce sales volumes were down by almost 100% compared with the previous period. Abandonment rates were way up – peaking at 83% average across the industry.
    What we were seeing was mass consumer anticipation of holiday promotions, and purchases being deferred by millions of consumers.

    Unfortunately we have trained customers to expect discounts and promotions. Given this, I understand both Gap and Macy’s tactics.


  6. Manish Chowdhary September 4, 2010 Reply

    Thank you for your excellent comments, Charles and Chris.

    What are your thoughts on Social Networks that are dominated with under 40 audience and it seems like every retailer "strategy" pegs around giving this young consumers a "discount". Is this even sustainable and how would this play out in the long term?

    In the wake of Facebook Like button popularity, I have now heard there are Like "Farms" that help people rig the system. How many of the Facebook 500 million users are real and how many are just ghosts?

    Manish Chowdhary @goecart