How to Guarantee Coupon Security: 4 Tactics

How to Guarantee Coupon Security: 4 Tactics

By Holly Millar Icon comments Tags: Coupons, Marketing, Discounts

Coupons are proven to be an incredibly effective strategy to enhance your promotion marketing. But when set up incorrectly, coupons can easily fall victim to fraud, improper validation or lead to a major loss in revenue.

Here are four tactics to guarantee coupon code security:

1. Secure coupon validation
2. Implement redemption limits
3. Secure code structure
4. Timeframe and expiration

If you want to use coupons for your promotion marketing, apply these tactics to any business model, in any industry.

"More than 70% of US internet users said their purchases were influenced by coupons and discounts (eMarketer, 2016)."

But before you unintentionally give all your customers 50€ coupons, there are a some key security features you should consider.

Computer screen with code

1. Secure coupon validation

The example: Give a 5€ coupon to customers who clicked a Facebook link (including UTM parameters), valid when they have a total cart value of 50€

  • The coupon rules in place here include user profile information, UTM parameters and cart value
  • The coupon is only valid for customers who fulfill all of these conditions
  • If your promotion solution does not validate rules correctly, you could lose a lot of money
  • Ensure your promotion solution can create a secure coupon code and deliver the right reward to the right person.

2. Implement redemption limits

The example: You want to to give new customers who sign up for your newsletter a special coupon code valid for free shipping on the next order.

  • Limits to consider: redemption limits, customer limits and campaign limits
  • Limit the number of redemptions possible for individual coupon code (so customers don't send to all their friends)
  • Define how many times a customer can redeem a code based on something unique like a customer profile ID or email (typically one per customer)
  • Set a total cap for the campaign to control how many codes are distributed (can be unlimited)

3. Secure code structure

The example: You want to reward customers for their 10th purchase on your website with a 20€ code to use for their next purchase over 100€.

  • A secure code length is between 4 and 20 characters long to prohibit someone guessing the code.
  • Sadly there are some people (or maybe bots?) who try to guess codes.
  • Customize your code using a set of numbers, letters, or a mix of both. Either way, have the right code validation in place for optimal security.

If you are using Talon.One, our coupon settings calculate the chances of someone guessing your code to maximize code security.

4. Timeframe and expiration

The example: You run a promotion giving customers 50% off their next purchase if they use the code SUMMER-2017 within the next 72hours

  • Always set the exact start date, expiration date and expiration time of your coupon code.
  • Don't let customers redeem the code over and over for the entire summer (that would be embarrassing and a huge loss of revenue).
  • If you issue invalid or expired codes, this will lead to major customer dissatisfaction and problems for your customer support.

Graphic of payment validation

No matter your industry, there is no doubt that coupons are an effective promotion marketing tactic. So if you aren’t sending coupons yet, they will be part of your promotion marketing strategy very soon.

"In 2014, it was estimated that 16 billion eCoupons were used and projections show that an estimated 31 billion eCoupons will be used in 2019 (Invesp, 2016)."

When you were a kid, did you ever make special coupons and give them to your parents? Well you aren't five anymore and your marketing strategy involves running a coupon campaign targeting thousands of customers online.

But that shouldn't stop you! With a proper setup and solution for creating, managing and tracking your coupons, you can avoid issues with code validation, fraud, wasted revenue and wasted resources.

Ensure your solution has logical checks in place to ensure all rewards are carried out effectively and you avoid wasting your promotional budget.

What is your experience with coupons? Questions about coupon code security? Have you been a victim of code abuse or fraud? Get in touch or let us know your experience in the comments below.

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