How Coupon Extensions Interfere with Ecommerce Revenue ⎜ Clean.io ⎜ EP 144
Ryan Cramer: What's up, everyone? Welcome to my corner of the internet. I'm your Host, Ryan Cramer, and this is Crossover Commerce, presented by PingPong Payments, the leading global payments provider, helping sellers keep more of their hard- earned money. Hey, welcome, everyone. Happy Thursday, and welcome to another episode of Crossover Commerce. My name is Ryan Cramer, and this is my corner of the internet, where I bring in the best and brightest experts in the Amazon and eCommerce space to help share their insights on the most important aspects of selling online. That could be anything from product listings, to logistics, to sourcing, to paying your VA's, but it can also mean how to keep money in your pocket, and even, marketingwise, how to work with different companies out there to help boost conversion rates. That's right. I'm talking about promo codes, I'm talking about any sort of extensions, I'm talking about things that are going to help your business and brain shine, but also push that customer over the edge to make them convert. Now, it's different between Amazon and direct- to- consumer sites like on Shopify your own hosted site. We're going to be diving into that today. Because as you can tell, I'm very, very excited to be diving into this topic today. We're talking how coupon extensions interfere with eCommerce revenue. Not many people think about that. They think as a consumer, I, unfortunately... I'll probably get grilled by our guests by this, but I actually have some of these coupon extensions on my browser. That being said, it's not a bad thing. As a consumer, you might be saving money passively. We might be talking about saving$1 or two here, you might be working on a cashback site, so you might get a percentage of that sale. We're going to be talking about how that works, maybe why that's not so great for businesses, why that may not be great for consumers, and really, all at the end of the day, diving into coupon extension... basically coupon extensions, and how that's interfering with revenue, just in general. That being said, before we dive into everything today, Crossover Commerce is presented by PingPong Payments. No, not your traditional company, not the traditional name of table tennis company. We are a cross- border solutions company. Thinking about sending money overseas or any sort of entity to your VA's, to your suppliers, or manufacturers, but then also think about if you're selling internationally in different marketplaces. You can be selling on your Shopify store, your Amazon store, your eBay store, wherever it might be around the world, PingPong can actually help you repatriate your money back to your local currency and keep more money, and not leave it on the table when the world is in such a small margin of error. In terms of working with small margins, you want to make sure that you make that money work for you, and not just leave it out there and pay another fee. So, check out PingPong Payments, go ahead and click on that link or in the show notes below, if you're listening to this on your favorite podcast channel. That being said, I don't want to let my guest wait any longer. She is the VP of marketing at clean. io, her name is Kathleen Booth, and she has been working 13 years in the digital agency world, and was named by Top Rank as one of the 50 most top B2B marketing influencers in 2019. That's amazing. I'm super excited to have her on today. Thank you for joining us on Crossover Commerce, Kathleen Booth. Kathleen, welcome to Crossover Commerce.
Kathleen Booth: Thanks so much for having me, Ryan. I'm really excited to be here.
Ryan Cramer: Absolutely. As you can tell, I'm a fan about the topic, but I'm a fan of what you and your team are doing. But first of all, where are we calling in from? Where are we talking to you from? Where are you based out of, to help get our international audience context of where you and your team are located?
Kathleen Booth: Yeah, you got it. We are based in Baltimore, Maryland. inaudible, and currently sweltering through a hot summer day. So I'm excited to be inside and the air conditioning and talking to you.
Ryan Cramer: Right. Yeah, Maryland. I've not been to Baltimore or Annapolis. You said you were in Annapolis. We used to live in Virginia on the East Coast, so love the I- 95 corridor, shout out to that. It's a pain to get through on a day- to- day basis. But East Coast never seems to hit... It always is hot in the summer, but in the winter, you never... you seem like you're in that sweet spot, right? Winter is still a thing, but it's-
Kathleen Booth: Yes.
Ryan Cramer: ...right when you go a little bit farther south, it's like dicey, it's like-
Kathleen Booth: Oh, that's why-
Ryan Cramer: ...crosstalk handle.
Kathleen Booth: That's why I live here, in this part of the country, because we get four seasons, but none of them is really terrible. So it's a nice, happy medium.
Ryan Cramer: I wish it was only four seasons here. It feels like it's 17 seasons. It's hot, and it's cold, and then it's... oh, it's all over the place. My leaves don't know what to do. They're dropping in the middle of summer. It's all over the place. But anyways, we're not here to talk about weather, we're talking about you and your business. So 15 years in the digital landscape, 12 years or so in the digital marketing landscape. What would is that background like? Tell me from the get go, who's Kathleen, basically?
Kathleen Booth: Sure. So I have an unusual career journey. I spent the first 10 years of my career working in international development consulting. But I had done an MBA in marketing, and part of what I did on my international development work was specifically focused on communications, and how you can use strategic communications in different projects around the world. So, when I decided to get married and have kids, it was hard to continue traveling all over the world. So my husband and I actually started a marketing agency, and we had that company for 11 years, and grew to be a national agency within the United States. We were one of HubSpot's top partners at the time, very early in their partner ecosystem. In 2017, we decided we were ready to sell, sold that company, and then I went in- house at a succession of different companies as head of marketing. I tend to come in early stage, probably because I... once an entrepreneur, always an entrepreneur, and I love helping companies grow, and I love that early stage, when there's so much work to do, and so much opportunity. So that's really what brought me to clean. io, which is... We're a young company, we were founded in 2017. So, here again, just trying to come in early and take the company to the next level.
Ryan Cramer: So what's the mission, if you will, of clean. io? If I'm looking at it, it feels like something is dirty, or something is not right, now I need to clear it up, clean it up. But you're a tech company, so I'm going to assume inaudible right? For our listener-
Kathleen Booth: Yes.
Ryan Cramer: ...out there.
Kathleen Booth: Yeah. So our mission is to help companies protect their user experience, revenue and brands by giving them greater control over the third party code that executes on their websites. So I always like to say... I've been a marketer, my whole career, I'm sure lots of folks who listen to your podcast are marketers or have marketing experience, we're always told we own our website. While we legally do own our websites, we really don't have control over a lot of what happens on them because of the nature of the way the modern internet works. We build these websites, and we build them on a CMS platform or a shopping cart platform, we add apps and plugins, we have a script that gets added, there are browser extensions that can execute code on our site. There are so many ways that third party code comes into our sites that can have a dramatic effect on user experience, which then trickles down, and can affect revenue, can affect brand reputation. So we're all about giving website owners back the control, so that they are able to really manage the user experience and control their own destinies.
Ryan Cramer: Well, I love the perspective of, it's not really yours. In theory, this is what Amazon sellers go through nowadays, is it's not really their platform that they're building on or selling on, it's truly Amazon's marketplace, they just started selling an operating and trying to be efficient in that. Direct- to- consumer is a little bit more misconceive being, because you can build your website on any sort of platform, big commerce, Shopify, whatever that might be. But you might think like, this is it, this is... I'm going to just draw people's eyeballs to here, they're going to just shop how they're supposed to. But then as you learn all that, there's tools that you have to implement in order to support that, like shopping cart tools, all these different add- ons in order to help support your growing brand. But then also, there's other ones that look out and try to help the consumer" save money", which is what we're talking about today. So when people talk about eCommerce coupon code extension browsers, or anything like that, if someone's like, well, what are you talking about? I've never known such a thing... I see the little space, and sometimes it's even hidden on websites, right?
Kathleen Booth: Yeah.
Ryan Cramer: You have to like click it, and it opens it up, and it's like, oh, that's where you can place a promo code. I have always inaudible, people might be under the inaudible like, I don't have anything that's okay, or maybe I'll search for something. Why is this such an important topic that you're passionate about and clean. io is really working towards?
Kathleen Booth: Yeah, I'm so glad you asked. I loved the distinction that you drew between like an Amazon seller and a D2C company. Because if we made a real world analogy, Amazon sellers, it's like having a stall in somebody else's market. Right?
Ryan Cramer: Right.
Kathleen Booth: You don't own it, you don't control it. You get to rent some space there, but you're on somebody else's land, versus the D2C retailer, who has set out, specifically, to have a direct relationship with their customers on quote" land they own". They've built their own website, they are selling right to the end customer. That's the foundation of the whole business model. So anything that gets in between a D2C retailer and their customer is a real problem and a huge, huge frustration for them. So that's part of what we're really passionate about. We work with a lot of brands that are on Shopify, and I love Shopify's mantra of arming the rebels. They talked about that a lot. I think now, more than ever, that's so pertinent, because we're coming... hopefully coming out of a pandemic, fingers crossed, knocking on wood as I say that-
Ryan Cramer: Knock on all the wood around me.
Kathleen Booth: Right, exactly. If there's one thing the last few years have taught us, it's that we really can't take our favorite independent businesses for granted, whether those are restaurants or retailers or what have you-
Ryan Cramer: Right.
Kathleen Booth: ...because so many of them have disappeared in the last few years. If we want to live in a world where Amazon is the only place we buy, great. But if we don't, we need to arm those rebels, the rebels being the independent retailers, the D2C brands, the eCommerce folks, the folks that have recognized that the future is selling online, and are trying to pave that path. In arming those rebels, one of the things we need to arm them with is the ability to control what happens on their own website. That seems like a pretty reasonable thing crosstalk to ask for. Much like if you owned a store, a brick and mortar store, you should have control over who is allowed to come in the front door, and what happens once somebody is inside your premises. So with coupon extensions, you asked specifically about that. I'll start with the brick and mortar analogy. If somebody walked into your store, filled their shopping cart up with a bunch of things, came to your checkout counter, and you rang them up, and they were about to hand you their credit card. Imagine if somebody ran in the front door of your store, and then handed them a discount coupon right as they were handing you their credit card. They were intending-
Ryan Cramer: Right.
Kathleen Booth: ...to pay full price, but all of a sudden, now they're not. While that feels really good for customers, absolutely... And you alluded to this, it feels great to get a discount. To the retailer, that person did not need that discount to convert, and that's effectively what eCommerce coupon extensions are doing. The biggest ones, the ones that everybody has usually heard of are Honey, Capital One shopping. They're coming in at the last mile of the buyer's journey, and offering them discounts that they may or may not have qualified for. So the only other thing I'll explain is that the context, I think, that we need to have for this conversation is thinking about how the way coupons have been used has evolved. So, before the internet, coupons were really a top of funnel marketing tool, meaning-
Ryan Cramer: Right.
Kathleen Booth: ...that they were sent to us in the mail, or we found them in our Sunday circular, in a newspaper, we cut them out, and the whole idea behind those coupons was to get somebody sitting at home, who maybe wasn't thinking they were going to go buy that thing that day or that week, to actually decide to do that. Right? So the famous-
Ryan Cramer: Right.
Kathleen Booth: ...examples are the grocery coupons, oh, I didn't need tissues, but they're on sale, I'll get them, or the Bed Bath& Beyond coupon that we all got in the mail for many years, where I didn't need sheets or towels, but-
Ryan Cramer: 20%. Yeah.
Kathleen Booth: Right. crosstalk. But I'll go, because I never know what I might find, and I have this coupon. So used that way, they were very effective at driving new customers and foot traffic, and even repeat business. But what has happened is now that we have the internet, and all these new possibilities for how we can use coupons digitally, the way that marketers use coupons has changed considerably. So yes, we still use them top of funnel, by doing advertisements, display ads with coupons we inaudible. But, they're also used outside of the top of the funnel once people are on websites to try to get them to put things in a shopping cart, or to try to get them to increase the value of what they're purchasing to qualify for free shipping, or to come back when they've abandoned their cart. They're also used to reward VIP customers. But then there's a whole other category that they're used for, which is... or two other categories. One is affiliate marketing.
Ryan Cramer: Right.
Kathleen Booth: So we use them to drive affiliate business, to draft off of other people's audiences, and then to track the performance of that channel. And then the last category is tracking and attribution. We use them on podcast ads, on display ads, with affiliates. The theory, at least, is that when somebody comes to our site and uses that coupon code, that should be a trustworthy indicator that they came from the channel where that code was used. Now, that's the table setting. Unfortunately, what happens is, people may come in through affiliates, they may come in through your podcast ad, or what have you. They come to your site, they put things in their cart, and yet, when they get to check out, regardless of whether they've entered a code or they haven't, if they have a coupon extension, and it activates, the coupon extension is going to auto inject all of the codes it has until it finds the one with the highest value, and it's going to resolve to that. So if you came in from an affiliate code, but Honey has a more valuable coupon, it's going to replace the code you came in with. If you came in from a Facebook ad, and your coupon extension activates, it's going to... the cookie that it places is going to make it look like the coupon extension drove the business, and not the Facebook ad. So all-
Ryan Cramer: Right.
Kathleen Booth: ...of a sudden... And I'll wrap up in a second, so that you can ask questions. But all of a sudden, we have this very murky attribution picture, where we don't really know where our sales are coming from. It looks like coupon extensions are driving a lot of business, and then also, our average order value is going down, because large volumes of people are using coupons that we didn't intend to give them. In many cases, they're probably using coupons that they didn't need to use to convert. So these are sales that would have been full price, that now are lower than that. So the whole calculus behind pricing and discounting gets thrown into a state of disarray.
Ryan Cramer: Right. There's a lot to unpack there, but it's transformed into... I've been lucky enough to actually work in this field for many, many years, and I've seen it evolve over time, like you said. I remember for Black Friday, we would have to literally on the circulars get out everything to know where you would stand in line, where deals were going to be, and that, like you said, drives the foot traffic to these attribution locations, like Best Buy or Walmart, wherever that might be. Nowadays, it's coupon sites and deal sites that, hey, at this time, you can actually go apply either a promo code or the deal is only activated during these sets of times. It's, in theory, supposed to drive you to those websites and make those points of purchases. But like you said, there's coupon codes extension. I'll even add on Rakuten, who formerly was Ebates, who is big overseas, but now is, obviously, still... the whole cashback mantra. Extensions, for a listener out there who's still not understanding, coupon extensions reward you in different ways. It doesn't have to just be discounts on that specific website, it can actually be, if you have an account, and you shop consistently, there, they're driving or they're preaching, their mantra is, hey, we drive loyalty to brands direct to consumers. We get customers to your website by offering either a cashback or a point system, so that they get rewarded for any sort of gift card, any sort of check in the mail, which I get every so often, which is really nice in passing. But they do it on a quarterly basis. Now, how do they do that? It's because these brands are paying these businesses to, in theory, drive traffic organically from those websites, and they're giving them a percentage of sale. 10%, it could be as high as... It really just depends on the industry that you're in and what you're selling. But they cut that in half, and they give that back, half of it to the consumer, half of it to... they keep it, obviously, to make revenue for their business. So, Kathleen, what you're saying is that, in theory, all this stuff should work and keep in its lanes. But we know that people are smart, they kind of like cut into their other lanes. You said racing cookies, basically if it's driven from a Facebook ad or driven from an organic sale or email campaign, it's going to literally erase whatever cadences that you set up as that campaign, erase it, and say, nope, it's Ebates or Rakuten, or it's capital One, which is the newest one they've established. Capital One is going to be the one that gets attribution. At a high level, as a company, you're like, well, we shouldn't invest more in Capital One, and those kinds of things. But really, the conversion that is happening in the drive is from maybe an email campaign. So, if I'm listening to this, as a consumer, I can think how confusing it is to know truly what's valuable and all these assets. Is that fair to say?
Kathleen Booth: Yeah, it's really a mess. What's scary about it is that for eCommerce businesses and for eCommerce marketers, you rightfully pointed out that the coupon extensions themselves are affiliates. So there are a lot of merchants that choose to partner with them, and they pay them then a commission for every sale that they extensively drive. Generally, the way that companies decide whether to partner with them, is they look at what it's already costing them to acquire a new customer. So let's say it costs me$ 20 to acquire a new customer, because... How we calculate that is we add up all of our marketing and sales costs, and we divide by the number of new customers we're getting, it's a pretty simple equation. That's CAC, customer acquisition cost. If my CAC is$ 20, and Honey, or Rakuten, or whoever is telling me that, look, for each new purchase, you're going to roughly pay me$ 15, it seems like a no brainer, correct? So I would be like, sure, I'll partner with you. The problem is that when... because these extensions pop up at checkout, in the vast majority of cases, the people that are using them were not driven to the site in the first place through the extension. How did they get to your site? Well, if they got there through your Facebook Ad, or your email campaign, or your other... your SMS campaign, your Google Ads, whatever other channels you have going, there's a cost baked into that. So when you think about CAC to justify whether a coupon extension is worth partnering with, you really have to consider that if you're already paying$ 20 through your Facebook Ads and everything else to get somebody to your website, and then the coupon extension comes in at that last mile, claims credit, you're paying$ 20, plus, you're paying the commission to the coupon extension, plus, you're paying whatever discount on your margin the coupon is giving them.
Ryan Cramer: Right.
Kathleen Booth: So when you think about that, and you think about the margins that many eCommerce retailers run on, you are probably losing money, is-
Ryan Cramer: 100%.
Kathleen Booth: ...what I would say. And then and then we have a lot of data which I can pull into the conversation around what happens if you prevent coupon extensions? What does that do to your abandonment and conversion rates and AOVs? We can talk about that, too. But it's a very complicated calculus, and I think if you tend to look at coupon extensions and think that every time they show up in your attribution, they're driving a sale, you're kidding yourself, because there are a lot of other things that lead to that sale. The other thing I will note is that they claim credit, even if they don't find a coupon that works. So if somebody comes to your site with Honey, and they say, yes, Honey, test coupons, and Honey tests them, and Honey doesn't find a coupon that works, it's still going to take credit for that sale.
Ryan Cramer: Absolutely. So there's aspects of both Honey and even Amazon, to a point. So I'll even bring Amazon in, not drag its name through the mud. But Amazon has an assistant extension, which too, if you're not familiar with this, it's a really cool tool. I like it because it... Amazon does the same thing on D2C websites. If it's a similar product or brand, you can say, hey, it's actually being sold on Amazon for this much, and it will pop up on the side. If you're scrolling through a website, or if you're searching for a specific product, it will actually pop up on your browser and say, this is what Amazon found for any sort of products, and it will take you there. There's stuff like Amazon Smile, which is an extension. So if you shop through there, traditionally, technically, if you make a purchase, it's giving them a kickback to a nonprofit that you distinguish. I try to do that as much as possible if I'm shopping on Amazon anyways, to give some sort of kickback to a nonprofit. Very cool, it's not a lot, maybe 1%. But what they do is they also drive the same thing. They will kick a browser. Amazon, too, has an affiliate program. You see, I notoriously use this example. BuzzFeed is traditionally, almost entirely, built around affiliate marketing. If you see anything of a number, like 22 best Christmas present ideas under$ 25, super long- tailed keyword title. But then also, everything in there is buy it on Amazon. Click, that is an affiliate link. So it is literally driving... Any sort of browser extension, or anything like that, is giving attribution to BuzzFeed. Now, that being said, you can also kick that off with... If you kick it over to Amazon Smile, it will kill BuzzFeed's attribution and give it over to... They can literally cancel each other out back and forth-
Kathleen Booth: It's crazy.
Ryan Cramer: ... but it'sthe same product, same price, nothing changes, it's who gets last... it's called last click attribution, everyone. It is super annoying for a marketer and every single person of, actually gets the credit. So Kathleen, what do you say about like... In that regard, where are we in this world of either how we're fighting it, or how do we wade through all this cross... I call it cross border, cross lane attribution, if you will?
Kathleen Booth: I think attribution can be an incredibly complex topic. You've alluded to that. All of these things touch on last click. You could use first click, but there's problems with that. There are definitely new tools that are emerging that are really interesting. One of the ones that we've worked with and collaborated with is Ringside AI, that gives you a much more robust attribution picture. But I think at the end of the day, the only way for you to really know whether it's worth investing in some of these channels is to test turning them on and off, right? Like-
Ryan Cramer: Right.
Kathleen Booth: ...at the end of the day, that's pretty black and white. You could do a million complex attribution calculations, but... This is what we've tried to test. But with coupon extensions, for example, if you were able to run a trial on half of your traffic, and say, let's block them, not allow them, and then the other half, let's let them run free, and let's see what happens on those two cohorts, that's going to tell you whether it's worth using them or not. So that's the kind of testing we've been doing, and what we found is that when you block coupon extensions, you increase average order value by between four and 10%, depending upon, obviously, the retailer and the size of coupons they're offering. Basically, there is no negative impact on conversions or cart abandonment. Now-
Ryan Cramer: Wow.
Kathleen Booth: ...every case is different, but across the data set we looked at it, it varied within a tiny band of 1%. So what we've seen is that... Obviously, we have a product that has to do with this, which we can talk about at some point, if we want to. But what we've seen-
Ryan Cramer: Of course.
Kathleen Booth: ...is when people block coupon extensions, the ROI is is dramatic. It's something on the order of 1500% within 30 to 60 days.
Ryan Cramer: Wow. So I guess, do people... Maybe I'll just ask the simple question first, before we get into how you do that. Do people even know that... First of all, if I'm a consumer, I would know... Rest assured, if you're not creating coupon codes, you don't have to worry about this. If you don't have a place for promo codes, you're not offering it, probably not something you have to worry about. It's something that... it could potentially go across border, or it actually can effectively down the line. If they say, hey, we can drive more traffic because of this, this is also something very applicable to what we're talking about. Maybe enhancement of conversion, the conversions that you might be" missing out on". Although being true, is there... If you're not offering coupon codes, maybe not worrying about this as much, but if I am, how do some of these companies get hold of those? Maybe, let's even know the fact, how do I even know that an extension has this, or how it's affecting my business itself? Can I operate in a world where these coupon code extensions are affecting my business and I don't know about it?
Kathleen Booth: Yeah. So this is such an interesting question. So first, I'll answer how to get their codes.
Ryan Cramer: Right.
Kathleen Booth: There's really two different ways they get them. One is, people submit codes to them. There's the way to just manually submit it. And then the other is, and this is right in their terms of service, when you sign up and use these extensions, you're giving them permission to scrape any codes that you manually enter when you visit a website. So if you are a VIP customer for like a small independent retailer, and they send you a VIP code, and you legitimately get it, and you go to their website, and you type it in at checkout, if you have a coupon extension in your browser, it is going to take that code and give it to everybody. So that's really how they get it. The second question that you asked is, how would you know you have a problem? This speaks to really how we as marketers keep track of things. So if you are using coupon codes, you absolutely need to be watching redemption metrics. You also should really have a single source of truth for every code you've issued. I talk to a lot of retailers who just, and they're inaudible times they're like, " I didn't even know that code existed." So, just create a spreadsheet, where you enter in-
Ryan Cramer: Right.
Kathleen Booth: ...every code you create, and track it. But then, my suggestion is, at a minimum, you should be looking weekly, at your coupon code redemption metrics. And if you see a sudden spike in the number of redemptions, and it doesn't correlate with a marketing action you've taken... Let's say you sent out an email campaign, or one of your influencers or affiliates posted something. If you can't identify a correlating marketing action that drove that spike, then probably your code has leaked. What most retailers do at that point is they then start manually having to go out to all these coupon sites, and there are a lot of them-
Ryan Cramer: There are a ton.
Kathleen Booth: ...there's like more than 15, and hunting down, and searching to try to see who has their codes, which codes they have. And then once you find them, then you have to figure out some way to contact these people. These are big companies. They don't exactly list their people's phone numbers on their websites.
Ryan Cramer: Right.
Kathleen Booth: So you have to find a way to get in touch with them and send them something and say, please take my code down. The retailers we have spoken with have had very mixed results with that. Sometimes they're successful, other times, they're told sorry, we can't help you. Other times, they're told, hey, if you join our partner program, which effectively means you're using them as an affiliate and then paying them, then you'll have more control over the codes that we give out. So it's a very, very, very frustrating experience for retailers, and extremely time consuming, especially when you consider that you go through this on a weekly basis. And then the thing is, you might deprecate the code you issued that leaked, then you issue a new one. But that new one could leak the next week, too, because of the way the extensions function. So a lot of the retailers we work with have described it as being on a hamster wheel, where you're spending a couple of hours every week chasing down the same codes over and over, and more often than not, not getting a very satisfactory result.
Ryan Cramer: That's how the inside of my mind looked like when I was doing dealing with that for my retailer online, direct- to- consumer website. There's so much that I learned from doing all this. We talk about bad, but there's also good. There's ways to track all these attributions. You would hope that you can find different ways and uniqueness of it. For example, my tips, I always tell people either make them customized code for one off people. So if you're sending it as a loyalty thing, make it alphanumeric, and make a unique code to each individual email that you're sending out. Not only is it easier to see if it's redeemed or not, and you know who's redeeming it, because it's tied to an email or account, but you can know that if it leaks, there's only one that exists out there, and it can just be abused and whatnot. So that's what I found to be successful. And then second, if you are working with a specific extension... My favorite company I worked with was Brad's Deals, for example. Great organic audience, they would do promo codes, but they would also do sales, one and the same. They would actually request, and I know companies do this still, is be an exclusive code, which you would put their name in it. For example, if you're working with them, it would be like BradsDeals15, or Brad's Deals whatever. That way, I would be able to know it wasn't abused, it's coming straight from that source, I can still attributed to their model. If it came from any other source, and they tried to claim that code, I'd be like, nope, you're not getting a commission, and they can't fight it because the code is not theirs. Is there any other tips that you would suggest maybe for combating it?
Kathleen Booth: Yeah. I think that you're spot on that when you can, you should use single use codes, and there are a lot of tools that have popped up to make that easier. Those work really well for email campaigns and SMS campaigns. Unfortunately, they don't work well for display campaigns, for PPC-
Ryan Cramer: Right.
Kathleen Booth: ...for affiliate campaigns, for podcast advertising. There are still certain use cases, where if you want to use them as a marketing channel, you're going to need a general code, like you described. So certainly, at a minimum, I think if you're going to be doing these things, you better have a really tight process in place to consistently watch your metrics to catch when this is happening. And then as I described earlier, you can always try and chase the codes down manually. We, obviously, have a product we sell that makes it much easier to solve for, but that might not be right for everybody. So there are-
Ryan Cramer: Sure.
Kathleen Booth: ...definitely manual things you can do. But the smartest thing is to just... I call it a practicing good coupon hygiene, having that single source of truth for what codes you've created, watching them on a regular basis, and then moving quickly to shut down any codes that have leaked, and replace them with new ones.
Ryan Cramer: Right. I guess maybe a good another good tip that you can provide people, Kathleen, would be how often or how much should I have at any one given time? Does that make sense? How many should have floating around out there in order to maybe have a wrinkle on it all?
Kathleen Booth: I wish there was a simple answer to that. With most things in marketing, it depends. I think you should have as many as you need to use the channels that you've chosen effectively. So larger brands are going to have a lot of different channels activated at the same time. They might be working... If you have, for example, an ambassador program, or an affiliate program, you could have hundreds of affiliates or ambassadors, in which case you need hundreds of different codes. If you're not doing that, you might only need one or two codes, because you're doing a podcast ad, or display ads. So it really does depend on the type of marketing you're doing, and so it's... I think it's less about the volume of codes, and more about just how tightly you're keeping track of things on the back end.
Ryan Cramer: If we were maybe a little bit more advanced as a direct- to- consumer brand, would we... would it behoove us to make customized landing pages that either activate from a specific link or specific URL? Is that something that you can get as integrated as knowing that it will activate specifically if it comes from any other source, you can't get there, it's a hidden route, basically, to get there, and is only active for a period of time?
Kathleen Booth: Yeah, absolutely. I think where you can do that, also, do it. Use tracking URLs, use dedicated landing pages. But again, much like single use codes, there are certain channels... For example podcast advertising, you could say a URL on here, but odds are, somebody is going to have a harder time remembering a URL if they hear it audibly than they are knowing like, just go to clean. io, and enter, welcome10. That's not a real code-
Ryan Cramer: Right.
Kathleen Booth: ... byway, don't enter that anywhere.
Ryan Cramer: Don't do it.
Kathleen Booth: But that's easier to remember than me saying, go to clean. io/ blah, blah, blah. So that's why I think... We do have customers who've tested that, and they've found at the end of the day that offering coupon codes is as a more effective way for them to drive business. So it's all about... To me, it's about not tying the marketers' hands. Let them use the tools and the marketing strategies that are going to produce the best results, but do it in a way where they don't have to be afraid that their data won't be reliable, or that their margins are going to be hit too hard. That's what really shouldn't be happening.
Ryan Cramer: Absolutely. I think at the end of the day, if you're keeping an eye on this too, you're just actively throwing stuff out there, you need to rein it back in. Because ultimately, we don't want it to affect people to a point where you're just losing money per transaction. Sometimes it's a test campaign, where you need to see like, maybe I will lose on some of these products. But at the end of the day, there's lots of cool campaigns that you can put together in order to maybe drive up average order size, or to activate free shipping. My favorite campaign out there is... that I've seen to date, creatively, is putting your zip code or put in something to see if you qualify for free shipping. Now, the average consumer is like, Oh, that's kind of cool. But the marketer will be like, you sly devil. I see what you're doing there. Of course, you're probably going to offer free shipping in some way, shape, or form, probably a code out there. But how you package it also matters, the perceived value of what you're getting at any one given time. For example, most sites are set up where you can't use multiple coupon codes, it's no stacking on top of each other, so you would get for free... You can't get free shipping and 50% off, one or the other, and makes sure that you're back in talks to itself in that regards. You can't have multiple ones that you put in there. I want to say like Kohl's maybe does it, you can actually stack all these ridiculous coupons on top of each other. Know that if you happen to get crazy enough, like the coupon people that you see in the grocery store, and they're like, you get your three carts of groceries for a nickel, or something like that.
Kathleen Booth: The extreme couponers?
Ryan Cramer: Exactly. You know people like that might be crazy enough that they figure the loophole, and there's people that will constantly find the loophole and try to exploit it. It's given the coupon industry a very bad name for itself, and I know it is bad. But there's a great nuance to what they do, in theory, of creating loyalty and whatnot. Ultimately, it's just people who want to save money in any way, shape, or form. Do you have any tips, Kathleen, that maybe would mask or create the perception of savings, but also not have to rely on deal or coupon sites or promo codes in that regard?
Kathleen Booth: Yeah. I think it's really important for me to say that we're not anti coupon code.
Ryan Cramer: Right.
Kathleen Booth: In fact, I look at this as, we're protecting the retailer's ability to issue coupon codes. If we want retailers to be able to inaudible, we need to give them the ability to control how they're disseminated. Otherwise, they're just going to stop issuing them, which is bad for everybody. So it's not that we don't want to save people money, but I think given the situation, given the world we currently live in, where coupon extensions have made it difficult to near impossible for retailers to control this, some of the things... Obviously, if you can put protection in place, you should. Something like what we offer. But beyond that that's why I think you do see a lot of larger retailers offering... The general use codes they offer tend to be codes that they put right on their website homepage, and they-
Ryan Cramer: Right.
Kathleen Booth: ... makethem visible for everybody. Because it's like, this is the devil we know, we're going to give everybody 10% off of their purchase, and they can work that into their pricing then, and make sure they're still making their margins. But it prevents people from leaving the site and looking for another coupon. Part of the problem with couponing extensions and promo code boxes is that as soon as they pop up, it alerts people to the possibility that they could be-
Ryan Cramer: inaudible.
Kathleen Booth: ...getting a deal. So that's why sometimes they leave the website, and they look... they go to the RetailMeNots, or the other websites of the world, where they can search manually for coupon codes and test them, and that's friction- filled process. But if you can put a code front and center on your site, and let people... give people the peace of mind that they're already getting a deal before they even put things in their shopping cart, then they're going to stay focused on completing their purchase, and not leave that journey to try to go find some other deal.
Ryan Cramer: Like an auto fill, or like, hey, we already put... we did you a favor, we put in a promo code for you, or-
Kathleen Booth: That's-
Kathleen Booth: ...exactly
Kathleen Booth: right. Yeah. It's in the hello bar on your website, they click it, and it gets immediately applied, and then they can shop, knowing that they're already going to get that 10% off on everything they put in their cart.
Ryan Cramer: The best form of trying to" get a promo code", do you think it's always the same banner, if you will, but like, hey, put in your email, and you get an email to a 20% off coupon code. In theory, you want to think that that's going to guarantee or have a really high percentage of throughput as a customer or as a client or website, I should say, but know that they're going to put in their email address. But you're twofold. You're offering the same coupon to everyone, but in return, you're also getting their email address, capturing more data, more ability to blast out there, trying to get repeat business, things like that. It's almost like the trade off, if you will, of, all right, if I get you this, you give me this kind of, sort of. Is that-
Kathleen Booth: Yeah, I mean-
Ryan Cramer: ...crosstalk successful?
Kathleen Booth: ...we do see a lot of retailers a lot. When you first get to their site, you'll see, join our email newsletter list in exchange for some discount. That's a really common one. That's a really frustrating one for the retailer when that code leaks, because then coupon extensions give everybody the discount, and they don't have to sign up for the email newsletter list.
Ryan Cramer: True.
Kathleen Booth: But yeah, I mean, I think... This is true for like every business these days, given what's happening with third party cookies and privacy. All of us, no matter what business we're in, whether it's eCommerce, or B2B software, or what have you, we should all be thinking about building out what's called zero party data, which is owning our own audiences. The best way to do that is to get people to opt in to hearing from us and to give us their email addresses. That's an audience you truly do own. Going back to that concept of own versus rent, we all need to be thinking about that, given the direction the world is going with cookies and privacy.
Ryan Cramer: Right. So in that sort of celebration of what we're trying to do, what is it that you guys are... I say, you guys. Your you and your team, your vision, what does that look like in the world? You've conceptualized, how do we protect people, but also make it so that the relationship is not... we're putting people back in their lanes. The marketing channels that they're supposed to operate under, that they truly can work without interference. What is it that you're trying to... It's almost like wrangling people back in. How is clean. io wrangling everyone into their corners or their lanes respectfully?
Kathleen Booth: I think the only reason that we exist is that companies like the coupon extensions have made it impossible for retailers. They've created a situation where retailers feel like their hands are tied. S our whole goal is to come in and to restore some balance of power, and to say, yes, customers should be able to save money, and should be able to use coupons. But, the retailers that issue those coupons should be able to have control over them. Our platform is growing, we're looking at adding other inaudible around this notion that when you build your website, you should be able to control what happens on it. So we're never going to turn back the clock and live in a world where we're not adding third party code to our sites. If anything, it's just going to get more so. But, we should be able to do that in a way where website owners feel the confidence that when they add that code, they're going to be able to control how it affects user experience, brand and revenue.
Ryan Cramer: Amazing. In the world that I think technology has... you want it to work for you, do you have any... as a consumer, are you opting into any sort of other ways to find pricing? I think at the end of the day, I don't think it's the consumers fault or the company's fault. I think at the end of the day, people want to know they're not getting ripped off. They want to know... I don't want to turn around one day, know I bought my phone for$ 800, and then know I could have bought it for$ 750 tomorrow or down the street, or anything like that. People are just insecure like, I don't want to spend more money than I have to. But at the end of the day, maybe we're all cheap, and we want to feel like that, or-
Kathleen Booth: It's a great question.
Ryan Cramer: It's perceived value. What ways can people feel like they can actively find the best price, but not feel like they have to rely on tools like this?
Kathleen Booth: So that's such a good question. I'll say a couple things. I think that you need to be very aware of what you're opting into when you use these tools. It's really easy for us, in the digital realm, to just click the button and the coupon extension and let it run in the background, and then just see, oh, I just saved$ 25. It's very easy to do that. But if you really start looking at what the extensions are doing, if you look at some of the codes they're attempting, I think there are people out there who would think twice about using them. What I mean by that is, we see all the coupon codes that get attempted, and I see on the back end of our dashboard, codes like militaryhero30 coming through. And what that-
Ryan Cramer: crosstalk all of them. The ones that pop up are surprising, and they try to hide it, and then I click on them, just because once you click on it, you activate the cookie, so they don't care. But then it reveals all of them that are available. Some of them are like really... it's sad, but it's also... You know, for a fact... As a person, you know who they're targeting,
Kathleen Booth: Right. It's-
Ryan Cramer: People who are-
Ryan Cramer: ... whoa are family and friends, orthere's
Ryan Cramer: even companies out there who are saying, if you put in... I think it's id. me, if you've heard of them before. They actually put in military... If you're a first responder, EMS or something like that, you put in your military information, basically, or your code that you get... or ID you get from them, they verify all that stuff with national databases from the government, and then they apply that to a code. But then those same information gets abused, and it's actually put into the same ecosystem, which is so bizarre. If you think about where it's stemming from, people crosstalk. I would think you would feel bad, but I could be wrong.
Kathleen Booth: The story I always say is, I would never walk into a restaurant for lunch and say, I'm in the army, can I have a discount, when I am not in the army. That's in the real world. That is called stolen valor. And yet, we do it online. That's just one example. We've seen codes aimed at teachers and healthcare workers, we've seen employee discounts wind up getting into coupon extensions. So the parallel I would draw is, honestly, to what happened with Napster many years ago, where I might have legitimately bought digital music and decided I'm going to share it with a friend. It seems very innocuous, like sure, who doesn't want to get free music? But it's really harming the creators, in that case. The music industry, I think, did a very effective job of educating the general public on why digital piracy was a problem, and why in the end, it hurts all of us, even though in the short term it might feel good to not have to spend money on that song you like. There's a parallel with coupon extensions, in that it feels good in the short term. Excuse me, but it's really hurting all of these merchants. If we want these merchants to be around and a year, two years, three years, we need to give them the control. They have the right to decide who gets their coupon codes. I do think that there is a moral ethical dimension to this, where we need to think about, is it right for us to use codes that we didn't earn weren't intended for us? Is it right to for us to effectively impersonate somebody digitally in order to save money? And what is the impact that that's having on the retailer? So I certainly can't say whether someone should or should not use an extension, I don't want to comment on that. But I just think these are all things that we need to think about when we make our own choices.
Ryan Cramer: Just know that Kathleen and her team are secretly judging you in the background. crosstalk.
Kathleen Booth: No, I'm not judging anybody.
Ryan Cramer: No, it's okay.
Kathleen Booth: No, I'm not judging anybody. I mean, we-
Ryan Cramer: There's only one place we all get judged. No-
Kathleen Booth: We want consumers to win, and we want retailers to win. That's the thing. It shouldn't be this one- sided equation, and it is right now, which is really unfair.
Ryan Cramer: We go back to our original point of where this all stemmed from. It's the act of trying to push people over the top of, with the intent to buy, now I have to buy. It's the intent to, now I... Should I to, now I have to. What is that like... It's a psychological thing, too, and this is what I love talking about as a guest on podcast, host too, on other shows, is what is the buyer psychology? At the end of the day, we all want to make sure that we're... the art of deal, we want to make sure that there's perceived value in what we're doing, whether it's going to benefit me in the product itself, or in the rate at which I obtain that product, whether it's, they give it to me for doing a survey, or there was a give and a take, and I took advantage, or I didn't take advantage, but I gave something in return for this, like my time. That is a big thing. You can give time, and in return, they will pay you for it. You do it all the time in surveys. There has to be a perceived notion of a transaction. What is a transaction? A lot of people think, I'm still giving them money at the end of the day. Yeah, but if it's, again, not intended for you, or the special, or the deal, or the coupon is not for that audience, they know that you have more money that people may not be able to afford it, that's why they're maybe trying to level the playing field. So at the end of the day, we have to know that in order to grow businesses, we shouldn't actively, and maybe, potentially, unethically, take advantage of these kinds of opportunities in these roundabouts, and coupon code extensions is the title that we're going to be putting this all under too, as well. I know we're kind of butting up on time, Kathleen. With that being said, what's the... As we go into Q3 and Q4, this is just prime pickings for when you're going to start to see deals, more shopping, there's lots of commerce that's happening, and growth. What's the exciting thing that gets you motivated? You said you've been around for... in the business for a long time. What's exciting for you going into the rest of this year and early 2022?
Kathleen Booth: Oh. My gosh. What's exciting to me is when I talk to some of the retailers that we're working with, big and small. We have retailers as large as Caraway Home, Maiden Cookware, some big, rapidly growing D2C brands. And then we have some really cool smaller ones, too. When I hear them say things like, oh, my gosh, for the first time in so long, I feel like I can issue my codes and not have to worry about them, or, I feel like... One of our retailers, a company called ROAD iD, they had put a stop to growing their customer ambassador program, because they had this code issue. When I hear them say something like, now that we've fixed the code leakage problem... they doubled the size of their ambassador program in three months. That's what gets me excited, because we are coming into this crucial time of the year, and if people feel like their hands are tied, they're going to go in at a disadvantage to the most important time of the year, and you don't get those few months back. So for them to be able to go in and have all of the marketing channels available to them, to be able to trust their attribution data, to know that they're going to be not taking a hit on their AOB, that... it really does get me excited, and it makes me feel good, because these are brands that are doing really cool things, and they're the future of retail, a lot of these D2C companies. So we love supporting them.
Ryan Cramer: Absolutely. At the end of the day, this is what I also try to educate people on, and you hit it on the head, is a lot of these businesses are small businesses, small to medium sized businesses, that maybe they do, or maybe they don't even have a storefront somewhere in your town, that you might not know that they're also selling either on Amazon or also on their own website, that someone around the world now has access and the ability to, in theory, purchase that product. The ability for technology to grow in that context, we should be supporting that, and its efforts to grow naturally in supporting the business, like you had mentioned, but also not inaudible the fact of technology is all evil in and whatnot. There's so much beauty and being able to know that small businesses' products can now get to the other side of the world, and maybe help out somebody else with their their product or service or whatever that might be. So that's really cool. Is there anything that you're seeing in today's age that's maybe a trend that not enough people are talking about? You're also a podcast host, so I also want to make sure that we give that shout out to you. Are you hearing anything? Are you seeing anything, as an expert in the field, that we're not paying attention to?
Kathleen Booth: I think it goes back to what I said earlier, which is that... The trend I'm seeing... The other product that we have has to do with protecting large online media companies from dangers that they incur through the programmatic advertising ecosystem. So one half of our customer base is companies like the Boston Globe and CBS Interactive, and then the other half are these D2C brands. And what I'm seeing in the media space is going to hit the rest of us very soon, which is, as I mentioned earlier, the need to develop what I like to call zero party data. Many of us have relied on paid media for a very long time to drive business and to scale. Especially things like retargeting, that's really going to get harder in the future as third party cookies are deprecated, and as privacy measures get rolled out across iOS, across other platforms. So preparing now for those changes, and assuming they're coming, even though the timeline is a little bit murky, it's critical. If you look at the media business, where they live and die by audience, what they're all doing is they're moving to these newsletter strategies, where they're able to build up really robust email lists, and they're investing in very, very, very high quality content to drive regular readership through email newsletters. I'm looking at that. I think that's something that any business in any industry can look at as a really good way to future- proof their ability to own their own audience and to be able to scale that way.
Ryan Cramer: That's awesome. So, into the other side of the point I mentioned, you have a podcast. Would love to hear what it's about, where can we find you, how am I tuning in for the next episode? You said you had an episode today.
Kathleen Booth: Sure. So yeah. I've been the host of a podcast called The Inbound Success Podcast for the last four years. I can hardly believe it's been that long. I have published more than 200 episodes, and it's all interviews with top performing marketers who are getting extraordinary results. My whole goal with it, in each episode, is really peel back the onion and uncover what it is they're doing that's getting them better results than the rest of us are getting, so that we can leave people listening with really actionable takeaways. So if you're a marketer, I'd love it if you check it out, and let me know what you think.
Ryan Cramer: You can find that on all of your Apple or Spotify or your lovely podcast channels, too.
Kathleen Booth: Everywhere.
Ryan Cramer: Make sure you give her a star, give her a rating, as always, too. But that's fantastic, that's so cool. Four years you've been doing that, that means that we're listening to an expert in the field. It's so fascinating, have you... Maybe this is off the cuff question. Have you seen podcasting really take off as more people are consuming it? Is it because we're locked down, or is it because there's this new wave of amplified marketing? It's voice, it's conversation, it's stuff like this.
Kathleen Booth: Oh, I definitely think COVID accelerated it dramatically. I'm in a lot of Slack communities with marketers, and the number of people saying, I'm starting a podcast... I've had so many people reach out to me to ask me, like, how are you doing it? It's great. I think it's a great medium. I love it. This is so much fun to do, and I learn a lot when I interview people, which is part of what I love about it. I figure if I'm learning, then somebody else out there is, too. So I'm a big fan of listening to podcasts, I'm a big fan of hosting them, and I definitely think it's a great way to learn and stay on top of your game.
Ryan Cramer: Has anyone ever surprised you that said, I was listening to this episode the other... maybe-
Kathleen Booth: Yeah.
Ryan Cramer: ...celebrity or anything, someone you look up to?
Kathleen Booth: Oh, yeah. The coolest thing in the whole world is when you come across what I call random acts of podcast guests. So I'll be at a conference, or I'll be on LinkedIn, and some random person who I have never met before will either come up to me in person, or will send me a direct message and say, I just wanted to tell you how much I love your podcast, and I loved this particular episode. It's really cool, you know this. You sit behind the screen, and you put your content out there, and you don't know who's listening. You see the data in the backend, and so you know there's people, you just don't know who they are. When somebody reveals themself to you, it's a wonderful relationship, because you're meeting them for the first time, but it's like they already know you, which is kind of a cool thing.
Ryan Cramer: It's shocking. To pat us on the back, I'll say a little bit, is when people do approach you, it's like that shock value. Like you said, it's just me and you having a conversation across the internet, whoever wants to lend their ears or eyes... This is what's amazing about this experience. But then also, the people who want to actively opt into it, it's almost like you're winning their time, it's passively winning over their ability to get their attention. Does that make sense? It's not the-
Kathleen Booth: Yeah.
Ryan Cramer: ... activesales calls like, I know, you're busy right now, but I need to talk to you instantaneously. It's a conversational aspect of what you're bringing to the industry is valuable in itself, but also the diversification and just the nature of how you present it, too. There's a lot of podcasts that suck. Let's be honest, they're out there. They stopped for that reason. They were like, I don't know if anyone's listening, or, I don't have that vision. But just be consistent, know that you're going to have those rough patches, but you're going to have amazing conversations, like we did today. So again, crosstalk Kathleen, thank you so much for stopping by our corner of the internet, I like to call it, and just chatting with me about one of my favorite topics, affiliate marketing, but also coupon codes, and how we're going to innovate and grow the world. How can we find you or connect with you and check out clean. io? That is the website?
Kathleen Booth: Yeah.
Ryan Cramer: And that's how we reach out?
Kathleen Booth: The company name is clean. io, that is also our website. If you're interested in learning more about our eCommerce coupon extension blocker, it's called Clean Cart, we offer a 14- day free trial. So head to the website, and you can request that. If you're interested in asking me a question, connect with me on LinkedIn. I see my my list link is on the screen. But it's pretty easy to find on there, if you search Kathleen Booth, and I do connect with anybody, and I'm happy to answer your questions there.
Ryan Cramer: Amazing. Well, thank you so much again for spending the time, and lending your expertise to our listeners. I certainly learned a lot, and I know a lot of our listeners did, too. But thank you so much, and good luck on the rest of the podcasting journey. I'll definitely be subscribing and listening in, as well. So thank you so much for hopping in Crossover Commerce, Kathleen.
Kathleen Booth: Thanks, Ryan. It was a ton of fun.
Ryan Cramer: Awesome. Again, everyone else, thank you so much for hopping on Crossover Commerce today. We appreciate everyone if you're tuning in just for a few minutes, or if you sat through our entire interview. We will break this down into some great actionable takeaways on our channel. Again, thanks to our partners at Casted, they allow us to push all the channels, and then also break down audiograms of videograms. You can definitely check that out in the comment section in all of our episodes that we published on audio format. The video format, we're catching up, and you can find them on YouTube, but then there'll be broken down with our friends over at Casted. So I just want to give them a quick shout out, they've been fantastic to work with, as well. This is Crossover Commerce, this is Episode 144. We talked about coupon extensions, as well as how to protect yourself from negligent and bad actors, but then also, how to make coupon codes work for you, and tools like clean. io are going to be able to help you out. Make sure you check out Kathleen's podcast, and then also follow her on LinkedIn, as well. All right. Cramer again. This is my show, Crossover Commerce. We have episode five of the week coming tomorrow, again 145. It will be, How To Get Tegular Local Media Coverage Without Spending a Dime with Mickey Kennedy. You definitely want to check that out. But make sure you tune in again tomorrow. Click that notification bell, subscribe to our channels, and of course, rate us on podcast channels, wherever you might listen to a podcast. I'm Ryan Cramer, if I haven't told you enough already today. I appreciate your time, your listening, and we'll catch you guys next time. Take care.
Ryan Cramer of Crossover Commerce talks with Kathleen Booth of Clean.io about how coupon extensions interfere with ecommerce revenue.
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