What are the best types of promotions to convert online shoppers?
If your team has been using a one-size-fits-all sales promotion strategy, you probably can’t answer that. And that’s a costly mistake.
Using the same promos can actually hurt your brand and leave conversions and higher margins on the table. But using customer intent and behavioral data to offer a personalized promotion to each visitor during each session can do opposite.
So in this guide, you’ll find a rundown of the top types of eCommerce sales promotions to work into your campaigns, along with when and how to use them.
21 Main Types of Sales Promotions for eCommerce
These 21 promotion strategies will help you convert casual browsers and keep your existing customers happy. They may also make it easier to build brand awareness and acquire customers.
No, you shouldn’t use all of them at once, or even in the same quarter. But it’s smart to understand all your options and build a strategic handful into your promotional mix moving forward.
The most popular types of promotions include:
Discount-Based Sales Promotion Types
When you think of sales promotions, you probably think of offering a discount to incentivize conversions.
While price discounts are not the only types of promotions, they’re certainly the most widely known.
#1. Convert First-Time Visitors with a Welcome Coupon
#2. Build Your Email List with an Opt-In Offer
#3. Make Customers Feel Special with Exclusive Coupons
#4. Treat Customers with Celebratory Offers
#5. Trigger Exclusivity with Early Access Deals
#6. Clear Out Inventory with Holiday & End-of-Season Promotions
#7. Build Goodwill with Occupational Discounts
#8. Boost Onsite Engagement with Interactive Games
#9. Play it Safe with a Flat Price Discount
#10. Provoke Urgency with a Limited Time Offer
#11. Increase Average Order Value with Buy More, Save More Offers
#12. Boost Social Proof by Incentivizing Reviews
#13. Incentivize Brand Advocacy with Referral Discounts
#14. Recover Abandoned Carts with Checkout Incentives
Consider building some of these 14 promotion types into your sales promotion strategy.
#1. Convert First-Time Visitors with a Welcome Coupon
One of the most common promotion types, a “welcome coupon” is a low-risk promotion that provides new customers a discount on their first purchase.
New customers get to try your brand without paying full price, which makes the purchase seem less risky and more fun.
Check out how Shopbop does this by offering 15% off the first purchase:
Plus, offering this one-time discount means your brand won’t lower the value of your products (more on this later) since only the first order will be discounted.
When offering a welcome coupon, there are a few considerations:
- Avoid cannibalizing your margins by offering the same discount to every shopper. Shopper A might need only a 5% discount to convert, Shopper B may need a 15% discount, and Shopper C might not need any discount at all. Use Intent-Based Promotions to calculate purchase propensity and deliver the right promotion at the right time to get the customer to convert.
- Offer a welcome coupon only to those who are likely to use it based on their customer intent. Offering a welcome coupon to every new visitor regardless of their intent can harm brand perception.
#2. Build Your Email List with an Opt-In Offer
Email marketing is widely considered to be the most profitable marketing channels available today, with an ROI of 3800% according to some sources[*].
So it makes sense that you might want to build your email list, especially if the alternative is for your visitors to bounce and never return to your site.
So trading people a promotional offer for your visitor’s email address (especially if they aren’t apt to convert with a welcome coupon) is another simple promotion that could work well for your brand.
Because you’re asking visitors to give up their personal email address, an offer without strings attached works best here.
Check out how Under Armour offers free shipping on the first order when the visitor signs up for emails:
Normally the shipping threshold is $60, but they remove the threshold in exchange for the email.
You would then deliver the code for free shipping via email.
#3. Make Customers Feel Special with Exclusive Coupons
Exclusive discounts have the power to make customers feel special and motivated to buy.
When you offer special discount codes for an influencer audience, repeat customers, email subscribers, or social media followers, for example, these customers will feel like they’re part of a small VIP list.
They’ll be happy to use their VIP discount and feel as if they’ve “won” something the average shopper doesn’t have.
Your brand will be able to drive sales from small, specific segments of your customer base. And you can easily track them to see how they resonated.
#4. Treat Customers with Celebratory Offers
Whether it’s a birthday, wedding, or anniversary with your brand, sending specific celebratory discounts to commemorate a special occasion goes a long way with customers.
It shows your shoppers that you’re happy when they’re happy. It also makes them feel as if you care about them, not the sale.
Plus, when shoppers are celebrating something wonderful, they tend to spend a bit more — especially if they have a discount to treat themselves.
#5. Trigger Exclusivity with Early Access Deals
Early bird discounts are another type of promotion that works well despite not being utilized as often.
Similar to flash sales, early-bird deals reward customers for acting sooner than later. A Christmas-in-July discount or promo code to try a new product ahead of its launch creates that sense of urgency that encourages shoppers to take action.
As a result, your brand may rack up positive reviews for products just as the rest of your buyers are starting to consider these items. This early social proof may be just the push customers need to make a purchase.
#6. Clear Out Inventory with Holiday, Mid-Year, and End-of-Season Promotions
Holiday promotions (pictured below) and end-of-the-season clear-outs can also facilitate additional sales and help you get rid of seasonal inventory.
The only downside is that you’ll be competing with other brands doing the same thing.
To avoid that, you may want to consider staggering your sales, so they’re a bit earlier than your competitor’s promotions. You can also offer mid-year sales that don’t revolve around major holidays.
#7. Build Goodwill with Occupational Discounts
The COVID-19 pandemic made this next type of sales promotion popular, and for good reason.
When your brand offers exclusive discounts based on occupational or lifestyle statuses, you’ll boost sales and improve your brand’s image simultaneously.
Teachers, students, and seniors, for example, may be on limited budgets yet still want to try and enjoy your products. An exclusive discount will help them do so and tell them you understand their needs.
Discounts for veterans, current military members, and first responders also show your support. These will help your brand connect with buyers in these categories, so they’ll favor your products over your competitor’s.
#8. Boost Onsite Engagement with Interactive Games
If you have the resources to create quick, interactive games on your website that give customers a discount, you’ll likely see a quick uptick in sales.
Online spin-the-wheel and scratch-off games work well to engage customers and encourage them to use their discounts right away.
#9. Play it Safe with a Flat Price Discount
Another commonly used but effective promotion is to give customers a percentage discount or dollar off discount on their purchase.
Many customers will take advantage of these straightforward promos, which may spur them to buy now versus shopping your competition.
However, you don’t want to display price discounts like these to everyone, or your customers will begin to expect a discount on every purchase.
This is why it’s crucial that you offer personalized, 1:session promotions to each customer based on their intent and behavioral data.
Check out how Levi’s offered a 10% discount for this session:
For another online shopper, Intent-Based Promotions may instead offer just 5% off as that’s what the customer might need to convert.
#10. Provoke Urgency with a Limited Time Offer
A flash sale or limited time offer creates a sense of urgency. It can be very effective for getting people to take action before it’s too late to scoop up your products at a discount.
This type of promotion is helpful if your brand needs to clear out inventory or incentivize sales of a specific product.
Just identify the product you’re looking to move:
Set the discount and duration:
And watch the countdown timer do it’s work.
Your brand can build anticipation ahead of time by teasing the flash sale via your email campaigns and social media channels. This makes the promotion more interactive, helps customers engage with your brand, and rewards them for acting fast.
#11. Increase Average Order Value with Buy More, Save More Offers
Buy-one-get-one (BOGO) free or for a reduced price will subtly encourage customers to increase their cart value.
These types of promotions work well for two reasons. They:
- Help your brand clear out more inventory at once, and
- Eliminate the customer’s “guilt” of spending more (because they’re also saving money).
Offering a buy more save more deal has a similar effect.
#12. Boost Social Proof by Incentivizing Reviews
Review discounts, where you’ll offer customers an incentive to leave your business a product review on Yelp, Google Reviews, or your website, are super popular.
Collecting these reviews in exchange for a small discount gives your brand invaluable market research.
Plus, this social proof helps lower the risk of making a first-time purchase for new customers. Once they see other people have tried your products with success, they’ll be more inclined to trust your brand and do the same.
#13. Incentivize Brand Advocacy with Referral Discounts
Referral discounts provide a discount to existing customers and anyone they refer to your brand. This tactic works on multiple levels.
First, it helps your company create brand ambassadors eager to spread the news about your store. As your customers pull in their friends and family to try your products, they naturally expand your brand’s reach.
You’ll score powerful word-of-mouth-marketing without having to spend on costly paid advertising or compete with other brands for ad space.
See how Wine.com does this:
#14. Recover Abandoned Carts with Checkout Incentives
Every eCommerce brand should implement and test cart abandonment promotions.
This means you’ll send a discount code to customers who added items to their cart but never followed through with the checkout (essentially, abandoning their shopping cart).
Check out how Bed Bath & Beyond does this:
These customers may need a nudge to help them move forward with completing their order, and a cart abandonment discount gently pushes them in the right direction.
When most brands test this promotion, they’re happy to learn it’s one of their best conversion tools.
Bed, Bath and Beyond would do well to reduce browse abandonment rates from the source by displaying this offer onsite to the online shoppers who are at most risk for abandonment.
7 Discount-Free Sales Promotion Types
Unless you’re a luxury brand with a strict no-discounting pricing strategy, some discount-based promotions will inevitably make it into your sales promotion strategy.
But building in only promotions that come with a discount is dangerous. Peppering your audience with discounts can:
- Erode brand perception
- Train customers to expect a discount every time they shop with you
- Cut into your margins
- Hurt marketing channel profitability.
You can incentivize conversions and activate sales without having to fall victim to these side effects of heavy discounting with these discount-free sales promotion types.
#15. Boost Revenue Per Visitor with Shipping Thresholds
#16. Reward Customer Loyalty with Points Programs
#17. Increase Conversions with Free Returns
#18. Introduce Customers to New Products with Bundles
#19. Offer a Gift with Purchase
#20. Generate Engagement with Giveaways
#21. Avoid Losing Customers to Competitors with Price Match Guarantees
#15. Boost Revenue Per Visitor with Shipping Thresholds
This eCommerce promotion type can:
- Boost average order value and revenue per visitor
- Improve margins
- Reduce cart abandonment rate
- Introduce customers to products they may not have otherwise tried.
All without eroding your brand perception with yet another discount. Instead of offering free shipping to everyone, this promotion type offers free shipping only to those who meet a minimum cart value.
Check out how one of Namogoo’s customers, Tea Collection has a free shipping threshold in their cart.
Instead of surprising customers with a shipping charge at checkout, setting a minimum order value to get free shipping provides a discount-free promotion to incentivize customers to keep shopping.
In Intent-Based Promotions, just choose your threshold for free shipping, selecting one above your current AOV:
Input it under Targeting > Cart Value in Campaign Settings:
Select the campaign audience or leave it up to IBP’s “promotional brain” to decide which visitors to display this to based on their intent.
#16. Reward Customer Loyalty with Points Programs
Creating loyalty programs that reward customers for their purchases not only fosters repeat customers, but inspires more brand ambassadors.
Each time a customer spends a dollar at your store, they can earn a point. Once they’ve racked up enough points, they can trade them in for a dollar-off discount (such as $5 off their next purchase) or a sample or travel-size product. For example, UGG provides loyalty points for various actions that a customer can redeem for a coupon.
Now, you’re giving customers a specific reason to shop your brand (i.e., to keep accumulating points) and encouraging them to make another purchase as soon as they hit your designated redemption threshold.
By giving back and showing customers you appreciate their loyalty, you’ll improve customer service and create a rewarding loop for everyone.
#17. Increase Conversions with Free Returns
Promotions don’t have to be price driven, and they don’t have to be offered only for a limited time. You can bake some sales promotions right into your policies, like offering free shipping and free returns.
When you offer free shipping and free returns, you lower the risk for potential customers, which can encourage them to buy from your brand.
Allbirds promotes their free returns policy as a conversion too onsite and in their emails:
When customers have the peace of mind free returns bring, they know they can return anything they don’t love, making them feel more comfortable adding items to their cart and hitting that checkout button.
#18. Introduce Customers to New Products with Bundles
Another type of promotion that can help you introduce customers to products they wouldn’t buy on their own, improve customer lifetime value and drive up average order value and revenue per visitor is product bundling.
Thrive Causmetics does this with bundles for specific events and purposes:
Bundling gives your brand the chance to cross-sell products that work well together. Your customers may be on the fence about purchasing each item individually, but if they can find a bundle that will help them solve their specific needs, they may be more likely to move forward.
You don’t have to discount your product bundles, but sometimes, offering as little as 5% to 10% off a bundle can be enough to get more customers to the checkout.
#19. Offer a Gift with Purchase
Who doesn’t like a free gift?
With this enticing promotion, your brand will offer a small product when shoppers meet a minimum spend threshold.
This works well for a few different reasons:
- You don’t have to discount your products, which protects brand perception.
- It encourages shoppers to spend a specific minimum to get their free reward, which naturally increases your average order value.
- If the gift is a product sample, you can let customers test it out for free. When they fall in love with it, they’ll return to purchase it (and other items).
As great as this sounds, this strategy may be even more effective when you offer a free branded item, such as this example from Thrive Causemetics below:
Giving away a free, branded makeup bag with each purchase keeps the company’s products organized for customers and helps them stay top of mind when customers are using them. It’s like a 24/7 marketing strategy and reward system in one.
#20. Generate Engagement with Giveaways
Just like free gifts with a minimum purchase, giveaways build excitement and get people to participate to win a prize.
This type of promotion will help you generate engagement in other places beyond your website, such as your social media channels and email.
Giveaways encourage your customers to share your brand with their own followers, some of which will be in your target customer pool, introducing new customers to your brand and engage existing ones at the same time for a true win/win.
The best part about giveaways is that you only have to hand over one prize — instead of giving one away with every purchase — which can save your brand a few coins while still generating a buzz.
#21. Avoid Losing Customers to Competitors with Price Match Guarantees
In today’s eCommerce environment, the competition for your target customers is fierce. Online shoppers have dozens of options to choose from to satisfy any need or desire, and with machine learning and behavioral analytics, any company with a marketing budget can get in front of them.
So the last thing you want is to spend money on a Facebook ad to drive visitors to your site only to lose them to more competitive pricing with the other guy.
That’s where price match guarantees can come in and save the day.
You’ll want to strategically use this promotion type and test it before working it into your strategy, though.
Offering a price match guarantee can entice customers away from your competitors and towards your product, which is clearly a good thing. But it can also breed price-sensitive shoppers who may only come your way when it’s cheaper.
So, if you’re going to use this type of promotion, be sure to diligently track your efforts to see whether customers return after that first price-match purchase or if they fall off after that discount disappears.
If the latter happens, this may not be a promotion worth continuing.
Now, before you start implementing and testing these top promotions, you should know:
The Problem with Most eCommerce Promotions
Using these types of promotions in your eCommerce business can seem like a smart idea — and it is — but there are a few caveats to consider before you start throwing all 21 types of promotions at your potential customers.
Excessive Discounting Reduces eCommerce Channel Profitability
Promotions and discounts affect your margins and drive down the profitability of your digital channel if you’re not careful.
While a 30% discount may entice customers to purchase from you, if that means cannibalizing your margins, it’s not worth giving that much away.
Promotion-Heavy Brands Can Harm Brand Perception
Discounts may hurt your brand’s reputation and customers’ perception of it.
If you’re competing on price through discounting, people will always expect to buy at a discounted rate. They’ll also value your products less than those from your more discount-judicious competitors.
If these people do not want to pay full price, they’ll quickly turn away and give their money to the next brand offering those steep discounts.
That’s why it’s best to use these promotions strategically, ideally offering the lowest possible discount or incentive necessary to convert each individual customer based on intent.
Using Intent-Based Promotions is the best way to tackle both these issues simultaneously.
How to Use These Sales Promotions Strategically
So you want all of the benefits of a well-crafted sales promotion strategy, but you want to avoid the pitfalls mentioned above.
You can use these types of promotions strategically by offering the right promotion to entice each visitor to convert at the right time.
This is where behavioral segmentation based on customer intent and predictive analytics comes into play. Some visitors need a generous discount to convert while others just need free shipping. And many don’t need a discount at all.
Rather than offering everyone the same promotion regardless of their purchase intention, behavioral data, and customer segment, intent-based promotions personalizes the customer experience and maximize conversions, average order value, and margins.
Intent based promotions are promotions your brand only offers once it’s clear that someone is very close to making a purchase.
Intent-Based Promotions delivers some incredible benefits for your brand, including:
- 45% less time to purchase
- 15% digital revenue increase
- 25% reduction in promotion cost
- 15% less journey abandonment
As you can see, it pays to be more strategic about your promotions rather than doling them generally to everyone.
So instead of throwing out discounts left and right, hoping one entices your customers to take the next step, use them strategically and let AI do the grunt work with Intent-Based Promotions.
Intent Based Promotions are Easy with Namogoo
Our powerful IBP tool helps you deliver the right promotions at the right time in your customer’s journey. Your brand gets to capture the sale without giving away too much of the house.
This helps you diversify your promotions, boost sales, keep your brand’s value high, and it protects your margins from sinking too low.
How does this magic work?
Using a powerfully driven AI promotion machine, Intent-Based Promotions considers the intent of each website visitor in real-time.
It takes in this crucial information — along with your margins, current inventory, and your promotional calendar — to deliver the promotion that sense for your customer and your business, helping your team to:
- Shift your promotion budget away from casual browsers and towards those with an actual intention to buy. This helps drive conversions, shortens your time to purchase, decreases cart abandonment, and ensures you’re not wasting good offers on digital window shoppers who don’t plan to make a purchase.
- Predict which promotions will deliver the most value. Using unique and anonymous pre-journey data and in-session behavior, our tool predicts the right promotions to get the job done (i.e., score a conversion). This works even if your shoppers are first-time visitors.
Because we’re using artificial intelligence, each visit is individualized and helps take your promotion strategy to the next level. It’s like offering a personalized shopping experience to every customer, no matter where they are in their customer journey.
You can finally break the vicious cycle of depending on promotions that ultimately eat away at your margins. Now you’ll only utilize them when they make the most sense.
- Pinpoint which promotions work best on your audience. Our intuitive analytics help you pinpoint which promotions your shoppers respond best to, which lets you stay in control of your promotion costs and revenues.
These analytics will also provide insight into your customers’ price sensitivity, propensity to react to incentives, and the products they’re most likely to buy with a discount.
Include These Sales Promotions in Your Promotion Strategy for 2021
Though these sales promotion types are the most popular, that doesn’t mean they’ll be the most effective for your sales promotion strategy.
If you don’t want to give away more discounts than your business can sustain, consider acting more strategically with Intent-Based Promotions.
