Michael Dell: The Coupon Master

Friday, January 23, 2015

I was perusing the Dell website when I came across what looked like the dumbest innovation in the history of online marketing. The site added a "find coupon" button to the ordering page that appears after a user adds a product to his shopping cart. Conventional (though often incorrect) wisdom states that a consumer who has added an item to his shopping cart at a given price is willing to pay that price. Providing a coupon to him is akin to leaving money on the table.

On second thought, there are a few reasons why the use of such a button might make sense on consumer-facing websites.

• Many shoppers simply give up on their orders when they see an "apply coupon" field but do not have a coupon in hand (for fear of paying more than necessary).
• Many shoppers will feel better about their purchases knowing that they used a coupon for a "discount," even though the site's prices had already been raised to compensate.
• The site can control which coupons are displayed to the visitor. Rather than encouraging users to search deal sites for excellent coupons, users can be satisfied with mediocre ones.
• The "find coupon" button has been de-emphasized, so some consumers will not see it anyway.

Yet it was only when I clicked on "find coupon" that I realized the absolute genius of Dell's strategy. While I did find a meager 10% off coupon that I could apply to my purchase, I was bombarded with a series of upsells encouraging me to buy additional items. After all, wouldn't it make sense to get a new camera or printer along with my shiny new computer?

Normally, I recommend that folks be as descriptive as possible, but upsells are the exception that proves the rule. When attempting to deceive a customer (or less disparagingly, "migrate around a customer's defenses"), it is often effective to mislabel or misconstrue what is being offered. Had the "find coupons" button been given a name more appropriate to its function (such as "find other products to buy"), far fewer customers would have any desire to click it.

While many will take issue with what Dell has done to sell its products, no one can find fault with the way that I sell my software pricing ebook. I limit my sales methods to the highest ethical standards. That being said, it's fascinating to see how those with differing sales philosophies act in the modern marketplace.