The impact and ROI of offer personalization

Overall, coupons are a versatile marketing tool that benefits both consumers and businesses. They provide cost savings, incentives for purchase, increased sales, customer loyalty, brand awareness, and valuable customer data.
loyalty gift cards retail

Delivering engagements that matter to your customers is about making sure that you give them the right offer, at the right time.

But when it comes to showing the ROI of offer personalization, many grocery retailers struggle to show its value within their organization and to align with CPG brands to boost campaign funding.

Till now.

In this article you’ll find out about the benefits of offer personalization, key metrics to measure coupon ROI, and top tips and best practices to boost the impact of your campaings.

Let’s dive in!

6 main benefits of offer personalization in the grocery industry

1. Value for consumers:

Coupons allow consumers to save money on their purchases. They provide an opportunity to get discounts, special offers, or free items, enabling shoppers to stretch their budgets and get more value for their money.

2. Achieving sales goals faster:

Coupons can be used as incentives for customers to buy specific products or try new products or categories, enabling retailers to achieve sales objectives.

For instance, coupons can help you break even with products that do not sell well. They can also encourage trial and exploration of different brands or product variations by reducing the perceived risk or cost associated with trying something new.

Here are some campaign examples:

Campaign typeCampaign goalExample
Recovery campaignRecovering clients that have stopped buyingDiscount of 1, 2 or 3€
Upsell campaignIncentivizing the increase in consumption of total basket, specific categories or products. As we know the amount of € each client is buying, we can force them to spend more with a minimum purchase on the coupon.Discount of 1€ for a purchase of 10€ in beers
Cross-sell campaignIncentivizing clients to try new categories or products15% discount on fruits and vegetables
Loyalty program welcome campaignGiving discounts for new members of the club (can be done by coupon or by extra points)Discount of 2€, with a minimum purchase of 30€
Download app campaignIncentivizing clients to download the APPDiscount of 3€
3. Growing your customer base:

Coupons serve as a promotional tool, creating visibility for the business. They can be used to attract new customers or entice existing customers to make additional visits to the store. They can be distributed through various marketing channels, reaching a wide audience.

4. A proactive tool against churn:

Successful personalization programs are about making sure you give value to your customers: be proactive, understand their preferences and help them get the best shopping experience.

Coupons can be used strategically to retain existing customers. Offering exclusive discounts or special promotions to repeat customers helps build brand loyalty.

5. Collecting valuable data and customer insights:

Coupons often require customers to provide information or sign up for newsletters or loyalty programs. This enables businesses to gather valuable customer data about preferences and purchase behavior, which can be used for targeted marketing campaigns and personalized offers in the future.

6. A competitive edge:

Offering attractive discounts or unique promotions can differentiate a brand from its competitors and attract customers who are seeking the best deals.

How do we normally recommend splitting the budget for coupons?

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Key metrics for measuring coupon ROI

Let’s start with refreshing the definition of metrics that are important in calculating the effectiveness of coupon promotions.

Coupons delivered

This metric represents the total number of coupons distributed or sent out to customers through various channels such as email, direct mail, social media, or in-store promotions. It reflects the reach of the coupon campaign.

Coupons redeemed

Coupons redeemed refers to the number of coupons that customers have used to make purchases. This metric indicates the effectiveness of the coupon in motivating customers to take advantage of the offer.

Redemption rate

In the context of promo campaigns, code redemption is the act of exchanging a coupon code for a discount or a product. Coupon redemption rate is a ratio of people that actually used the promo code.

You can calculate it with this simple formula:

Nr of redeemed coupons / Nr of delivered coupons x 100.

Total investment

Total investment refers to the overall cost incurred in creating, distributing, and promoting the coupons. In addition to the discount value, it includes expenses such as design costs, printing costs, advertising expenses, and any other associated costs.

Break-even point

The break-even point (BEP) is a situation in which the project does not generate profit or cause losses. At this point, the revenues are equal to the total costs, and the financial result is zero. In other words, all you have spent to produce or deliver the service is covered by the money you made on it, including all the discounts you gave with coupons.

The following formula is used to calculate the profitability of a promotional campaign:

Total costs / Product margin.


Discount refers to the amount of money saved by customers through coupon redemption. It is calculated by multiplying the number of coupons redeemed by the value of each coupon.

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Incremental sales

Incremental sales are calculated with a control group of customers comparing the purchase behaviour of the customers that redeemed the coupon vs. the purchase behaviour of the control group.

Incremental ratio

The incremental ratio is a measure of how much additional revenue is generated for each dollar spent on the coupon campaign. It is calculated by dividing the incremental sales by the total investment. This ratio helps evaluate the efficiency and profitability of the coupon campaign.

These metrics collectively provide insights into the effectiveness of the coupon campaign in driving sales, customer engagement, and overall return on investment.

Coupon ROI

Having covered the initial two metrics, we’ve reached a crucial point in coupon processing –calculating the return on investment (ROI) of your coupon campaigns. It is one of the most frequently used profitability metrics. It shows you the effectiveness of your marketing campaign.

To calculate the ROI for coupons, you need to determine the overall increase in revenue from increased sales due to the coupons.

Most retailers calculate the ROI of promo codes by using the following formula:

Incremental sales / total cost

Coupon campaign ROI example

Loyal Guru’s platform enables a detailed view of all coupon campaigns, including aggregated ROI, performance, monthly evolution and analysis.

To calculate the effectiveness of each personalized campaign, grocery retailers need access to advanced retail stats and metrics. In Loyal Guru’s offer personalization dashboard, retailers can see each campaign with its details and current metrics updated in real-time.

6 ways to boost coupon ROI

1. Make the coupon about the customer and not the discount

Great offer personalization is about making sure you deliver the right offer to the right person at the right time.

By leveraging advanced retail analytics and customer insights on sales and categories performance, grocers can tailor each offering to the right customer, through the right channels.

Identify each campaign’s target audience, and tailor the coupon to their preferences and shopping habits.

Some segmentation best practices include:

  • Segments based on the customers’ age.
  • Segments based on the family situation and marital status (such as single, couple, large families, etc.).
  • Work occupation-based segment (collectives).
  • Location-based segments.
  • Segments based on the revenue per customer.
  • Customers divided according to their activity.
  • Segments based on favourite categories.
2. Leverage customer data and predictive analytics to increase CPG collaboration

Great offer personalization also requires that retailers and CPG brands are perfectly aligned.

By sharing insights on the performance of personalization campaigns, grocers are able to bring CPG brands on the same side of the table, so they could both see opportunities, launch campaigns that worked for everyone, and increase CPG investment over time.

3. Enable in-store and online redemption:

Provide various ways for customers to redeem their coupons. Options may include in-store redemption, online shopping with a unique promo code, or through a mobile app. Offering flexibility increases the chances of conversion.

4. Distribute coupons via multiple channels:

Distribution channels can include print media, email marketing, social media campaigns, mobile apps, and loyalty programs. Consistent and strategic promotion across multiple channels increases visibility and engagement.

5. Double down on compelling copywriting and eye-catching design:

Craft concise, persuasive copy that clearly communicates the offer’s benefits. Use actionable language that encourages immediate action, such as “Limited Time Offer” or “Redeemable this week only.” Highlight the value proposition and create a sense of urgency.

In addition, create visually appealing coupons that stand out. Use attractive colours, high-quality images, and clean layouts. Ensure that the coupon design aligns with your brand’s aesthetics and includes clear instructions on how to redeem the coupon.

6. Use expiration dates and restrictions:

Set a reasonable expiration date to create a sense of urgency and prompt immediate action. Make sure to clearly communicate any restrictions or limitations, such as specific products or purchase thresholds, to avoid confusion and disappointment.

What coupon restrictions does Loyal Guru’s personalization module support?

Total discount per customerExcluded productsCoupon validity per location (city, postal code or store)
Coupon expiry dateProduct-related limitsDiscount combinations and stacking
Overall budget limitsLoyalty program membership (based on email verification)

With Loyal Guru, retailers can protect your budget with smart validation rules for your coupon campaigns. Your marketing team can define order structure and budget constraints conditions, ensuring that only specific orders can claim discounts and that each customer can redeem the offer only once – or any other designated number of times.

How Loyal Guru’s offer personalization module helps grocers succeed with their coupon campaigns

Using Loyal Guru’s budget control to ensure profitability of offers

Loyal Guru powers trackable coupon codes to monitor coupon redemption and measure campaign performance. This enables grocers to access a valuable campaign forecast before launch, and analyze data to gain insights into customer behavior, assess the success of specific personalized offers, optimize campaigns in real-time or refine future promotions.

Review in advance an accurate forecast on campaigns’ performance

Our personalization engine let’s you review the numbers before hitting the GO button. If you are not satisfied with the forecasted results, go back and edit your campaign until you feel comfortable to launch.

This information gives retailers insight into what strategies are working and which ones may need to be adjusted. It can also help them identify any potential issues with the code or campaign and make changes accordingly.

Automated campaigns

With our support, you can forget about ineffective one-size-fits-all promotions and launch millions of highly personalized coupons in minutes, scaling up by 200 your company’s personalization campaigns in one fifth of the time.

By selecting pre-defined campaign plans (such as increased AOV, recovery, CPG or upsell campaigns) or by building your own, Loyal Guru’s retail-ready toolkit quickly tackles the most common retail challenges.

Use automatic Smart Audience suggestions

Our platform automatically recommends the best performing audiences based on historical purchase and browsing data and real-time shopper intent. Design a CX that feels on-point and individualized for each and every customer.

Work closely with your suppliers to increase wallet share & monetization

Turn data into assets. Work closely with your CPG suppliers, improve business relationships and increase monetization for your campaigns.

Give them access to a portal where they can review campaign forecast, performance results and ROI.

Loyal Guru users achieve a sustained increase in important KPIs, such as:
  • 7:1 ROI
  • 15% redemption rate
  • 50% of customers redeeming at least 1 coupon
  • 80% time savings in launching campaigns
  • 200 million personalized offers delivered every month
  • 15% increase of active customers
  • 2x incremental sales
  • 25% increase in AOV
  • 63% of discounts and offers funded by CPG brands


Overall, coupons are a versatile marketing tool that benefits both consumers and businesses. They provide cost savings, incentives for purchase, increased sales, customer loyalty, brand awareness, and valuable customer data.

Remember, while these concepts serve as guidelines, it’s essential to test and iterate your coupon campaigns based on real-world results and customer feedback. Regularly review the performance of your coupons and make adjustments as necessary to optimize conversions.

Loyal Guru’s platform is used by leading enterprise retailers across the globe – and reaches millions of consumers every day. Powered by Loyal Guru, retailers can collect and analyze all customer data in one place, and create next-level personalization and loyalty campaigns to grow revenue and market share.

These are just a few features of Loyal Guru’s offer personalization module:

  • Coupon codes generator that ensures the uniqueness of codes.
  • Tool for creating coupon restrictions.
  • Tool for automatically assigning codes to customers.
  • Infrastructure for coupon delivery, or 3rd party integrations with your favourite tools.
  • Advanced analytics for tracking redemption rates and campaign ROI.
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If you’re a retailer and you’d like to talk about any of the personalization strategies outlined in this article in more detail, please get in touch with our team – we’ll be happy to show you examples or talk through your brand’s unique challenges.