Website coupon codes are an important tool for marketing, data collection, and inventory management. Coupon codes can attract new customers, reengage dormant ones, and increase overall sales. Offering a discount, even a minor one, can give a hesitant shopper the final push they need to complete a purchase. At scale, these marginal improvements to conversion and retention rates can add up over time to a major revenue boost.

When customers use coupon codes, businesses gain insights into their shopping habits, preferences, and which marketing channels are most effective. This information can help businesses refine marketing strategies. For instance, if many customers are accessing a code after seeing it on a specific social media platform, this indicates a strong presence of potential customers on that platform.

Coupon codes can also help businesses manage and optimize inventory. If certain products aren’t moving as anticipated, limited-time discounts can help clear out stock and make room for new merchandise. This can be particularly useful for seasonal items or perishable goods.

Online shopping is expected to account for over 20% of all retail sales globally in 2025. As ecommerce continues to grow, discounts are a key strategy for businesses. Below, we’ll explain what you need to know about website coupon codes.

What’s in this article?

• How do website coupon codes work?
  
• Benefits of website coupon codes for businesses
  
• How Stripe Checkout can help
  

How do website coupon codes work?

Coupon codes are alphanumeric strings that businesses provide to customers as a promotional or marketing strategy. When customers enter these codes during the checkout process, they receive a discount or special offer. Businesses use these codes to stimulate sales, reward customer loyalty, and attract new customers.

When a customer applies a coupon code during checkout, the shopping cart system verifies it and recalculates the total purchase amount. Businesses can set different parameters for coupon codes, including expiration dates, minimum purchase amounts, and usage limits.

Coupon codes can target specific products or broad categories. For instance, a code might provide a discount for a particular brand, or only for new arrivals. This allows businesses to promote slow-moving inventory or boost sales of new products.

Many businesses employ coupon codes as a response to abandoned carts. If a registered customer doesn’t complete their purchase, the business might send them an email with a coupon code to entice them to do so.

Another strategy involves distributing coupon codes through affiliate marketers. Affiliates share these codes with their audience, driving traffic and sales to the business’s website. The affiliate earns a commission for every sale made using their specific code.

Benefits of website coupon codes for businesses

Businesses can use coupon codes to achieve a variety of objectives, from increasing sales to strengthening customer relationships. Website coupon codes can provide several benefits for businesses, including:

• Increasing sales volume: Customers are often motivated to make a purchase when they see a potential for savings. A limited-time discount code can create a sense of urgency and motivate customers to buy.
  
• Driving traffic: Distributing coupon codes through different channels—email, social media, or affiliate partnerships—draws attention to your brand, leading to increased website visits.
  
• Clearing out inventory: If certain products aren’t moving as quickly as expected, coupon codes can provide customers with a needed push.
  
• Promoting new products: Coupon codes can incentivize customers to try new items.
  
• Rewarding loyal customers: Businesses can reward repeat customers by offering special discounts, which in turn can bolster customer loyalty.
  
• Collecting data: By tracking which coupon codes are used most frequently, businesses can gather insights into customer preferences and shopping habits.
  
• Increasing average order value: If a coupon code has a minimum purchase requirement, it can encourage customers to buy more.
  
• Reducing cart abandonment: When a customer leaves items in their online cart without purchasing them, businesses can email them a coupon code—nudging them to finalize the sale.
  
• Boosting off-season sales: Coupon codes can stimulate purchases during slow periods, helping businesses maintain a steady flow of revenue.
  
• Strengthening partnerships: Businesses can collaborate with influencers or affiliates by providing them with exclusive coupon codes for their audiences. This drives sales while strengthening relationships with key partners.
  

How Stripe Checkout can help

Stripe Checkout is a fully customizable prebuilt payment form that makes it easy for you to accept payments on your website or application. With Checkout, you can create a coupon code in the Dashboard or with the API.

Checkout can help you:

• Increase conversion: Checkout’s mobile-optimized design and one-click checkout flow make it simple for customers to input and reuse their payment information.
  
• Reduce development time: Embed Checkout directly into your site, or direct customers to a Stripe-hosted page, with just a few lines of code.
  
• Improve security: Checkout handles sensitive card data, simplifying compliance.
  
• Expand globally: Localize pricing in 100+ currencies with Adaptive Pricing, which supports 30+ languages and dynamically displays the payment methods most likely to improve conversion.
  
• Use advanced features: Integrate Checkout with other Stripe products, such as Billing for subscriptions, Radar for fraud prevention, and more.
  
• Maintain control: Fully customize the checkout experience, including saving payment methods and setting up post-purchase actions.
  

Learn more about how Checkout can optimize your payment flow, or get started today.