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Marketing tips

Coupon and Discount Ideas for Your Local Business

February 5, 2021
Written by Nextdoor Editorial Team
February 5, 2021 | Written by Nextdoor Editorial Team

This article was updated on August 6, 2021

As a local business owner, chances are you're always on the hunt for creative ideas to attract customers, boost sales, and increase your bottom line. While offering an incredible product or service is often the key to success, sometimes it takes innovation to keep customers walking through your doors or ordering through your online platform. 

Enter coupons and discounts.

This guide will cover the ins and outs of offering coupons and discounts while providing innovative ideas that will send customers running in your direction.

The Details on Discounts

Offering your products or services for less money than you usually do might seem bad for business but you'd be surprised at how leveraging creative coupon code ideas can boost your bottom line. 

Studies show a whopping 69% of consumers (7 out of 10 people) would switch brands based on a coupon discount they received on their mobile devices. Add that to the fact that research suggests 80% of people would buy a brand they ordinarily wouldn't because of a promotional code or coupon, and you've got a powerful tool at your fingertips. 

As powerful as coupons and discounts can be for driving sales, you need to be diligent when running sales and promotions.

It's About More Than Saving Money 

While most customers enjoy spending less when they take advantage of a promotional code or discount coupon, it's often the psychology of the "deal" that's the driving force behind this sale strategy's efficacy. 

Amazingly enough, one study showed that customers who used a discount coupon experienced a 38% rise in oxytocin levels. Oxytocin is a feel-good neurotransmitter, meaning using coupons and taking advantage of a special offer actually made customers feel happier. 

The Bigger Picture

Coupons and discounts provide benefits for both your business and your customers. Here's how: 

  • Promotions can be beneficial for driving traffic to your business, and potential customers may be more primed to spend once they're already there
  • You can help clear out old inventory and make room for new stock by incentivizing customers to purchase specific items (the ones discounted) 
  • If calculated correctly, items purchased at a discounted price can still generate a healthy ROI

What are Some Discount and Coupon Ideas?

Now that you understand the logic behind providing coupons and offering discounts, it's time to put theory into practice by looking at a few effective ideas as well as real-world examples of businesses that have achieved success with these strategies. 

Foster Local Loyalty 

You probably care a lot about your community and the people who make it feel like home. Not only can catering to neighbors help your business align with your community-based values, but it can also help build customer loyalty with shoppers that will keep your business thriving. Take a look at these coupon examples and discount code ideas. 

Punch Cards

Punch cards can help attract loyal, repeat customers by incentivizing return visits. The idea behind a punch card program is simple (and doesn't have to involve physical punch cards-there are many electronic options available). 

Essentially, your customers receive a reward for visiting your store a certain number of times or spending a specified amount of money. The benefits of this program include: 

  • It's easy to launch 
  • It's relatively inexpensive
  • It's simple for employees to implement
  • It's straightforward for customers to understand
  • It's flexible enough to be appropriate for many business models

For example, a local coffee shop may offer every tenth cup of joe free, or a hair salon may offer a free blowout after five regular services. Not only does this coupon discount strategy increase customer loyalty, but it also makes the consumer feel like they are rewarded for being a supportive shopper. Let's look at how one real business used punch cards to keep their loyal customers coming back. 

Success Story: Ample Hills Creamery, an ice cream shop in NYC, invited customers to be part of their "It's Always Ice Cream Weather" loyalty program to boost winter sales. Customers received a free scoop after ten punches, a free milkshake after 20 punches, and a free branded beanie after 30 punches. 

The ice cream shop's marketing strategy was two-sided. It worked to boost sales during a time of year when ice cream sales are presumably lower than in the hot summer months, and it made purchasing more ice cream advantageous to the customer. 

Nextdoor Local Deals

The difference between being just another small business and being a neighborhood staple often comes down to one thing-connecting with your immediate community. 

So how do you offer coupons and discounts to the people who live in your area? By claiming your free Business Page with Nextdoor. Once you have your page set up, you can customize its appearance, run special offer promotions with Local Deals, and engage your neighbors directly. Nextdoor creates a bridge between you and your neighbors, allowing you to speak directly to the demographic you're trying to connect with.  

Success Story: Gallagher's Rug & Carpet Care, a carpet care business based in Portland, Oregon, combined strategic timing (the end of the muddy rainy season) with Nextdoor to emphasize their commitment to fostering hyperlocal business. Gallagher's used Nextdoor's Local Deals to give neighbors an exclusive 20% off offer, which resulted in the company adding a bunch of happy new customers to their roster. 

Referral Discounts

Most businesses want one happy customer to lead to the next, which is why offering referral-based discounts yield fantastic results. Studies show that providing rewards increases referrals, so if you want your customers to act as built-in marketing hubs, you need to incentivize them to do so. 

The best part of offering referral-based discounts is that you only pay for performance, being that only successful referrals translate into the customer receiving a discount. Here are a few tips on how to make referrals effective: 

  • Use tracking tools to prevent fraudulent referrals-this could involve simple spreadsheets done on Excel or Google Sheets that track referral codes and the people who offer them. Or, if this is a major marketing ploy, it might be worth signing up for referral marketing software to keep track of your referral program.  
  • Provide clear referral terms to prevent confusion
  • Determine if you want your system to be one-sided or two-sided-in other words if you want to offer a discount to just the referrer (one-sided), or to both the referrer and the person who was referred (two-sided).

Not only does incentivizing referrals help spread the word about your business in your community, but it often means attracting potential customers who are likely to love your product or service (they're being referred for a reason).

At the end of the day, referrals typically drive the kind of business you're looking for. Once you've ironed out the logistics of your referral rewards program, it's time for the fun part: deciding what you're going to reward your devoted customers with. 

Consider these examples:

  • A percentage off their next purchase
  • Coupons for free products or services
  • Cash-back rewards
  • Store credit

Success Story: La Jolie Salon, a hair studio in Stamford, Connecticut, offers a 25% discount for referrals for both parties involved. The salon outlines their referral methodology on their website, where they tell customers "rather than place occasional ads in newspapers we prefer to reward our clients for referring us." 

Choose Your Timing Wisely

Timing is everything. This is true in many facets, and equally so when it comes to giving customers a discount. In some cases, offering discounts or coupons year-round can detract from the sense of urgency created by offering them for a limited time.  

That's why it's important to factor timing into your offering. 

Seasonal and Holiday Promotions

Running promotions around the holidays is "Marketing 101." It's the season for shopping, and consumers frequently seek out companies that offer the best deals when searching for the perfect gift. 

For many, finding a great coupon or discount is part and parcel of the joy of the season. As you outline what holiday deals you plan to offer as part of your marketing strategy, keep the following in mind:

  • Make your discounts festive with themed discount code ideas that combine creative branding and holiday charm. This could be as simple as using seasonal images and text on your discount messaging or going all out like offering a "Sweet Valentine treats for kids under 6" discount.
  • Set clear expiration dates on holiday coupons, both in-store and online, to avoid your promotion running beyond the actual holiday.
  • Offer discounts and coupons on seasonal items to prevent having unsold inventory you won't be able to move once the season passes.

Success Story: Goldune, a sustainable small business that sells home, lifestyle, and personal care products set up a creative promotion on Black Friday. Customers with the code ISHOPPEDSMALL received $10 off $100 purchases. This promotion was a great example of how timing is everything since on the brand's website they stated the deal was, "Our only sale of the year (and who knows, maybe next year too)." 

Keep Thinking of Ways to Build Your Business 

Finding ways to boost your sales and expand your new customer base are key to achieving business success. Using coupons and discounts can be instrumental in this endeavor. 

Hopefully, this guide inspires you to ramp up your small business's sales strategy by leveraging discounts and coupons. At the end of the day, the perfect positioning for your promotion is going to hinge upon your unique business. What do you think your customers would respond to? How can you reward loyalty in a way that's registered authentically? 

With some creative brainstorming, diligence, and timing, there's no reason you can't become one of the success stories mentioned in this article. 


Forbes. How Retailers can Maximize the Power of Coupons.

Huffington Post. What Science Says About Discounts, Promotions, and Free Offers.

Nextdoor. Local Deals Brings in New Customers for Portland Business.

Ample Hills Creamery. Welcome Winter with Our Loyalty Program Starting Today.

Researchgate. A Penny For Your Thoughts: Referral Reward Programs and Referral Likelihood.


Claim your free Business Page to get started on Nextdoor. For resources on how to use Nextdoor to stay connected with your local customers, pertinent news affecting businesses, and more, follow us at @nextdoorbusiness on Facebook.

Claim your free Business Page to get started on Nextdoor. For resources on how to use Nextdoor to stay connected with your local customers, pertinent news affecting business, and more, follow us at @nextdoorbusiness on Facebook

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