Estimating the Effect of Timing on Coupon Effectiveness

The coupon incentive is one of the most common tools marketers use to court users to engage with a business at various stages of the customer life cycle.

A variety of factors can affect the effectiveness of a coupon incentive on users, timing being one of them.

We hypothesize that coupons can be more effective when delivered at critical times in the customer journey, right when a user is engaging with the platform.

Verifying such a hypothesis would typically require real time event-triggered coupon distribution software that may be too expensive to implement.

In this paper, we propose a framework in which we apply causal inference on "natural randomized control trial experiments" to measure the effectiveness of sending coupons at the right time to users without requiring a dedicated AB test.

We demonstrate the usefulness of our framework in the case of a user onboarding coupon campaign held in our company and show how the results can lead to correct data-driven decisions for the business.

Furthermore, in order to test the generalizability of our framework, and to make our research more reproducible, we apply our framework on a user retention campaign with a publicly available dataset.