How to Create Coupons on Amazon

The original 1822 meaning of the word coupon was "certificate of interest due on a bond," or a piece that could be cut from a bond and presented for payment, according to the Online Etymology Dictionary. Coupons later became something people cut out of newspapers and magazines for discounts. The first coupon is believed to have been a ticket for a free glass of Coca-Cola, and was offered in the late 1880s.

Near the end of 2017, Amazon brought coupons to Seller Central, likely as a way to boost sales and motivate sellers. But these aren't your grandmother's coupons. And they aren't your ordinary promotional codes either. So what should Marketplace sellers know about how to create coupons on Amazon Seller Central?

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How to Create Coupons on Amazon

Learning how to create Amazon seller coupons is actually pretty easy, and setting up the coupons requires only a few steps.

Log Into Your Seller Account

After you log into your Amazon seller account, click on "Advertising," followed by the word "Coupons" in the drop-down menu. For first-timers, an intro page should appear with some basic information, including a video that will help to walk you through the process. Follow the steps up to "Submit coupon"; after that, Amazon will review the coupon before it goes live.

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Decide on Coupon Limitations

Amazon allows you to limit the number of coupon redemptions per customer. Alternatively, you may allow the same customer to use your Amazon coupon multiple times. You can also target customers by specifying Amazon Prime customers only, or select for any buyer at all on a given Amazon seller coupon. You must also decide how long a coupon will be available — anywhere between one and 90 days.

Set Your Budget and Item Number

Here are some important steps to take before you create your first Amazon seller coupons.

Set your budget. Decide in advance what your budget is going to be. Once you set that, Amazon will deactivate your coupon as soon as that limit has been reached, so you won't have to worry much about going over budget (though your spend exceeding your budget could still happen). Note that Amazon actually takes your coupon offline once your budget has been 80% utilized.

Decide how many items you want discounted. You should be able to use either ASINs or SKU numbers to create coupons, and according to Amazon Seller Central, you can enter up to 200 parent ASINs to run a coupon on.

Select Your Discount Type

You're able to discount a set amount of money off a product, or a percentage. According to experts, either is attractive to buyers, and which to use may depend on the price point of the item you wish to discount. Consider this: Even though $5 off and 25% off a $20 item is the same amount, buyers might perceive 25% as a greater discount. Therefore, they'll be more likely to shop the item with those savings rather than a simple $5 off.

The Good and Bad of Amazon Seller Coupons

Benefits of Creating Coupons

The biggest benefit of using Amazon seller coupons is the visibility they can achieve for your products. However, one extra advantage is that Amazon seller coupons are discoverable on the platform. A green banner calling out each coupon shows up next to listings on Amazon search result pages. And a coupon will appear in your listing with an orange icon that helps your product to stand out.

SEE ALSO: 8 Amazon Listing Optimization Tips You May Not Have Considered

Amazon also features items discounted with coupons in their Today's Deals section. Additionally, coupons are shown to improve customer conversion rates — or the number of sales you net per page visit.

Downsides of Amazon Coupons

So what's the catch? Well, first of all, Amazon charges 60 cents per redeemed coupon, so that can cut into your profits if you aren't careful. Also, sellers can only offer discounts based on an item's lowest listed price over the last 30 days. And don't forget that Amazon can modify or cancel coupons at any time.

Make sure you've considered how coupons might eat into your profits, especially since there's no guarantee a customer will return to your Amazon Marketplace shop and buy that item again at full price.

Amazon seller coupons are another promotional opportunity for your Amazon store. Understand your profit margins before you begin in order to make the most of them.