You must clearly articulate rules on your Shopify store to ensure customers understand that coupon code abuse is not allowed.
Write a dedicated clause in your Terms and Conditions about using promo codes. Ensure the language used is simple and easy to understand. Highlight the potential consequences, such as account suspension or legal action, to discourage misuse.
An example clause could be the following "The use of illegitimate coupons is strictly prohibited. Any discovered misuse may result in the transaction being reversed and account suspended.”
You can also have a friendly reminder on your discount code policy, as did the brand 8JS :
Obviously, you must have a robust and reliable system for managing your promotions.
E-commerce CMS like Shopify come with efficient, built-in discount management systems.
For enterprise-sized companies with legacy software, solutions like Talon.one offer a promotion rules management engine accessible through an API, capable of handling complex rules.
At a minimum, your system should be able to:
Once your coupons have been created, it's important to manage their distribution.
A good tactic is also to fake a unique coupon code, giving a true feeling of exclusivity to loyal customers (but, of course was almost immediately auto-applied by Honey).
Geotargeting restrictions is a key strategy to control the distribution of coupon codes.
By utilizing geotargeting, businesses can precisely define the geographical locations where a coupon code is valid. Unfortunately, this is not a built-in features in Shopify.
If a promotion is tailored for specific customers in a designated region, it makes sense to restrict the coupon code usage accordingly. This dual approach not only enhances the targeting precision of promotions but also acts as a robust deterrent against misuse.
Maintain a list of the most frequently used coupons over the last 24 hours and thoroughly review them.
Correlate the usage of these coupons with your attribution platform like Polar Analytics of Triple Whale. This will help you understand the origin of your coupon users and identify if specific channels are leading to excessive coupon usage.
Pay particular attention to customers who heavily use coupons. Identifying them is not easy. So, an effective approach is to compile a list of orders associated with coupons and cross-check them against IP addresses and shipping details. This will enable you to identify users who may be operating multiple accounts.
Don't forget to monitor your affiliate program as well, given that a significant portion of coupon code abuse occurs through such programs. Regularly check which affiliates are driving the most conversions and ensure their legitimacy. Exercise caution with so-called “affiliate networks”, as illegitimate players often hide behind.
Start with the n°1 safety measure: impose a time limit on each coupon. It's easy to do in Shopify and prevents the use of outdated coupons, keeping your promotions current.
Upgrade this by incorporating a maximum usage limit, adding an extra layer of defense. If you're prepare for a marketing campaign, estimating the maximum number of conversions is key.
But finding the right balance is a challenge: you want to encourage legitimate users while preventing abuse. This calls for active monitoring and adjustments of the usage limit when necessary – it’s a task easier said than done as it’s time-consuming.
A wise move is to establish a minimum order requirement, which is also a basic set-up in Shopify. This should align with your Average Order Value (AOV) and profit margins. Optimal results often come from setting up tiered discounts, ensuring flexibility and effectiveness in your promotional strategy.
To prevent coupon misuse, it’s recommended to focus your discounts on specific products. Watch your profit margins closely. Use a system that tracks how each coupon affects your profits and focus your discounts only for chosen items or categories in your catalog. This will keep a balance – give tempting discounts while ensuring your bottom line stays healthy.
To keep a rigorous control over profit margins, it is imperative to prohibit the stacking of coupons within your system. This option is available in the built-in discount system of Shopify.
Allowing customers to stack multiple coupons can pose a significant financial risk, potentially resulting in money loss. For instance, if a customer applies two distinct discounts on a single order, the final price may end below the cost price, compromising the profitability of that sale.
By disallowing coupon stacking, you can maintain a predictable revenue stream.
To support your coupon code security, steer clear of the usual suspects used by all Shopify merchants like SAVE, WELCOME, LOVE, BLACKFRIDAY. Opt for unique and creative codes that are less likely to be tested by browser extensions.
Embracing creativity in code generation is a straightforward yet effective strategy to safeguard your campaigns from easy exploitation.
Also, keep it fresh. Avoid using the same code patterns across different campaigns or years. This simple step ensures that your promotions stay secure and distinct.
The most common pitfall: sending the same coupon code to lots of people.
The issue?
Within two hours, that code is leaked, and folks who weren't meant to get it are cashing in.
The fix?
Make a unique code for each customer. This keeps things sealed tight, making sure only the right customers can use the code.
It's not always a walk in the park. If you're using Shopify or Klaviyo, easy peasy. But if you have your own system, it might need some hands-on work, like creating and bringing in a list of unique discount codes.
This approach is best for keeping loyal customers and bringing back the regulars. But what if you want to bring in new customers?
That's where DealGuard shines. It's the way to go if you want to generate unique discount codes at scale, even for customer acquisition.
Let's talk about a big contradiction: exciting promotions can boost sales, but they also attract more scammers.
The major issues with abuse include:
Customers often exit the checkout process to search for discount codes when this field is prominently displayed.
By strategically hiding it or relabeling it as "special offer" or using synonyms, businesses can make it more challenging for customers to conduct external searches on Google.
Another layer of protection can be added by blocking browser extensions that automate the search for discount codes.
While some Shopify apps assert their ability to prevent discount code injections, it's essential to recognize the complexities involved.
The recent migration to Checkout Extensibility on Shopify, will block the ability to integrate Liquid script into the checkout, and therefore make it more complicated to block extensions.
It is not a straightforward task, and relying solely on these apps may offer more of a patch or workaround than a long-term solution.
To block injections comprehensively, you should explore more robust and adaptable security measures that necessary imply changes into their checkout page, to modify the UX by installing scripts or dedicated apps.
Boosting visibility on Google among various players involves a smart SEO move – create your own coupon page.
Therefore, users will access and view all available coupons in one spot.
This dedicated page will easily rank high on Google, and will act as a beacon for users seeking promotions, positioning your brand as a reliable source for exclusive deals and fostering a positive customer experience.
The best part is that it won't cost you a thing. Better than paying Google Ads just to get your own users back, isn't it?
When users attempt invalid coupons, likely sourced through hunting, a strategic response is to propose a valid coupon with a limited but enticing discount.
While this solution isn't flawless, it allows businesses to offer a reasonable discount, like 5% instead of a leaked 20%, avoiding potential losses and unfair affiliate commissions.
A prime example of this technique's effectiveness can be observed on the website of La Redoute. By employing this smart recovery strategy, businesses not only salvage potential sales but also maintain control over discount rates.
In the quest for a valid discount code, users tend to make multiple attempts, a behavior ripe for exploitation.
To counter this, implementing a script that block successive attempts from the same user becomes crucial. This not only guards against brute force attacks but also helps maintain the integrity of your discount system.
Consider setting up a system that triggers a temporary block for 15 minutes after 5 unsuccessful attempts within a 5-minute window.
Relying solely on email verification poses risks due to the ease of email changes.
To mitigate abuse, it's crucial to link emails with IP addresses, technical information such as browser version, and shipping addresses. This multi-layered authentication process acts as a powerful defense.
During the account creation phase, you can display a message alerting users if a similar account already exists based on IP adress and other technical information.
Depending solely on email verification opens doors to potential risks, especially considering the ease with which users can change their email addresses.
To counteract this vulnerability, it's imperative to establish a comprehensive authentication system that links emails with IP addresses, technical information such as browser and configuration, and shipping details. This multi-layered approach serves as a robust defense mechanism against fraudulent activities.
During the account creation phase, a simple message can alert users if an account with similar details already exists, adding an extra layer of scrutiny.
Leveraging behavioral analysis empowers businesses to scrutinize customer interactions with the discount code field, providing a powerful tool to identify potential fraudsters and proactively block coupon misuse.
For instance, if an unusually high frequency of coupon attempts is detected within a short timeframe or if there are repetitive patterns suggesting automated interactions, the system can promptly flag and prevent unauthorized coupon usage.
Maintaining a watchful eye on third-party coupon websites is essential to thwart potential code leaks and unauthorized usage.
A practical approach involves conducting routine searches for your own codes on popular platforms such as Google and TikTok. This proactive monitoring strategy allows businesses to promptly detect and address any instances of leaked codes circulating on external platforms.
Creating a curated list of the top 10 coupon code websites is crucial. Regularly checking these identified platforms on a weekly basis helps businesses stay ahead of potential code leaks and ensures swift response measures.
