What is Coupon Conversion?

Working Out Coupon Conversion

Coupon conversion = orders that used the coupon ÷ people who got the coupon × 100

Only count orders placed inside a set window, like the two weeks after the send.

Pick the Bottom Number Before You Compare

The formula divides by everyone who got the code. Some teams use a smaller group instead, and that moves the answer a lot. Here's the same email counted three ways:

• Everyone who got the email: 96 ÷ 2,400 = 4%
• The 600 who opened it: 96 ÷ 600 = 16%
• The 120 who applied the code at checkout: 96 ÷ 120 = 80%

None of these is wrong. The first grades the whole send, while the last only asks whether people who tried the code went on to pay. What matters is that you compare coupons on the same bottom number.

What Shopify Counts for You

Shopify gives you the top number. Every code on your Discounts page shows how many times it's been used, and every order shows which code was on it.

The bottom number usually comes from wherever you sent the code, like your email app's send and open counts.

Watch out for leaks, though. If your code ends up on a coupon site, strangers will use it. Their orders land in the top number even though they were never in the bottom one, so the rate looks better than it is. That's one form of discount code abuse. A rate over 100% points to leaks or to the same shopper using the code more than once.

Used Coupons Aren't Added Sales

Coupon conversion counts people who used a code. It can't tell you how many of them would've bought without it, and that's the number that decides whether the coupon paid off.

A holdout group can answer that. Say the tea shop also picked 2,400 other new subscribers at random and sent them no code. In the same two weeks, 60 of them ordered anyway. So the code added about 36 orders (96 − 60), not 96. The other 60 or so buyers would likely have paid full price, but they got 15% off. That's a basic A/B test: code versus no code.

Discount size moves the rate too. Bigger discounts usually get used more, but each use costs you more. Our piece on how to pick a discount percentage covers that trade-off. A coupon can also change how much people buy. For that side of it, see our guide to balancing coupon conversion and AOV.

One Code per Visitor in Growth Suite

Growth Suite, our app, predicts which visitors will likely buy anyway and doesn't show them an offer. Only walk-away customers get one, and it's time-limited. Our article on dedicated buyers and walk-away customers explains the split.

Each offer comes with its own single-use code, which the app adds to the cart. Because a code works only once, a leaked one can't turn into hundreds of uses. You can also A/B test discount depth and pick the winner by conversion rate, AOV or total revenue instead of by how many codes got used.

Mix-Up: Coupon Conversion vs. Store Conversion Rate

It's tempting to put a 4% coupon conversion next to your store's conversion rate and call it a win. But your store rate covers all sessions. Coupon conversion only covers people you chose to send a code to, and they may already like your brand. Those are different groups, so a higher number doesn't prove the coupon worked.

Related Terms

• Discount Code
• Single-Use Code
• Automatic Discounts
• Revenue Attribution
• Gross Margin