Advanced Analytics for Ecommerce: Tracking Coupon Extension Metrics
by Eric Trouton, on Sep 30, 2021 11:52:46 AM
Trying to understand how coupon extensions are affecting your revenue as an online retailer is a bit of a mystery currently. Many retailers know it is affecting them, but have trouble really quantifying the effect it is having on their bottom line.
We’ve gathered a list of metrics that are valuable to understand in order to really investigate how much coupon extensions are pulling out of your pockets.
So, what metrics should you be keeping track of in order to understand the effects coupon extensions are having on your revenue and margins?
- Top coupon codes used
- Number of completed orders where a coupon extension was used
- Value of the discount for each sale with a coupon extension
- Which coupon extensions were used for each sale with a coupon extension
- Cart abandonment for users with coupon extensions
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Top Coupon Codes Used
One of the metrics you can take a look at even without a specialized tool is how often your coupon codes are used. We recommend pulling a list of the top coupon codes used on your site over a period of time and sanity checking it for potential unauthorized coupon usage.
If you see a coupon code being used at a much higher frequency than you’d expect, you can check the major coupon extensions to see if they’ve gotten ahold of that code. You would download and install each of the coupon extensions and test them on your own site as you test the checkout process to see.
If you do have a specialized tool like cleanCART, you will be able to specifically pull a list of the top coupon codes being attempted by coupon extensions and, if you aren’t choosing to automatically block them, then you can at least deprecate those coupon codes so they no longer work on your website.
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Orders with a Coupon Extension
To really dive deeper into the hit you are taking on revenue, you’ll want to know how many of your orders were completed with a coupon extension applying a discount.
Again, this metric isn’t available from standard analytic tools and requires a tool like cleanCART to measure. The average we are seeing across our customer base currently is 7% of transactions completed have a coupon code injected by an extension.
Value of Discount Injected by Coupon Extensions
The previous metric gives you the volume of transactions affected, while this one quantifies the total amount of revenue per transaction that you are losing to coupon extensions.
To see these metrics specific to your own website, you’ll need a tool like cleanCART. In this case, an average is readily available from the coupon extensions themselves. Honey publishes on their website that the average discount applied by their extension is 17.9%.
Breakdown of Coupon Extensions
This metric is more for informational purposes than it is a direct understanding of how much your revenue is changing, but it is still important to understand.
This metric is a breakdown of the percentage of affected transactions coming from each different browser extension. This will help you understand which browser extension is truly causing you the biggest headaches.
Across our beta test group for cleanCART, we are seeing the following breakdowns:
- 52% Honey
- 15% Rakuten (a.k.a. Wikibuy)
- 11% Amazon
- 2% Piggy
- 1% Swagbucks
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Cart Abandonment Rates
Another really important metric to take into account is cart abandonment. In an ideal world you’ll want to compare the average cart abandonment rate for users with a coupon extension and users without a coupon extension.
Understanding this will help you take stock of if coupon extensions are actually helping you close deals (even though they may be eating into your margins) that you may not have closed without them.
Across the board in our beta test group we are seeing evidence that coupon extensions aren’t improving cart abandonment rates, and that overwhelmingly people who are buying using an extension would have still completed their transaction without the discount (meaning that these extensions are essentially just costing online retailers money and not necessarily helping them close new sales).
This will still be important to keep an eye on for your own site to see how these rates appear in your unique situation.
The Bottom Line
There really aren’t any solutions on the market today that allow you this level of clarity into how coupon extensions are affecting your site experience and revenue. This is why we built cleanCART and are inviting you (yes you!) to join the beta test group and learn more about how they are affecting your site!