The Hidden Cost of Uncontrolled Discount Codes

Discount codes are a core part of ecommerce growth.

They’re used to:

• Incentivise creators

• Close conversions

• Reward loyalty

• Support affiliate partnerships

But when left unmanaged, they quietly turn into one of the most expensive and invisible problems in ecommerce.

This is known as coupon leakage and it affects far more brands than most realise.

What Is Coupon Leakage?

Coupon leakage happens when a discount code meant for a specific audience or partnership becomes publicly available and reused beyond its original intent.

This commonly includes:

• Creator or influencer-specific codes

• Affiliate welcome discounts

• Retention or abandoned cart offers

Once leaked, these codes are quickly picked up by coupon websites, browser extensions, and deal-sharing communities, often within days.

Why Coupon Leakage Is a Bigger Problem Than It Looks

At first glance, a discounted sale still feels like a win.

But over time, coupon leakage creates three compounding issues.

1. Margin Erosion Without Incremental Growth

Most shoppers now expect a discount.

In fact, over 60% of online shoppers actively search for a promo code before checking out, even if they were already ready to buy.

When leaked codes are applied:

• You’re discounting customers who would have converted anyway

• Discounts stop being an incentive and become an expectation

• Average order value quietly declines

What was meant to drive growth becomes a permanent margin leak.

2. Broken Attribution and Misleading Performance Data

Leaked codes don’t just affect margins they distort reporting.

When a discount code appears on:

• Coupon aggregator sites

• Browser extensions

• Generic affiliate pages

Those platforms often receive last-click attribution, even if they had no role in influencing the customer.

The result?

• Coupon sites look “high performing”

• Genuine creators appear underwhelming

• Budget decisions are made on the wrong signals

This is one of the most common reasons brands struggle to identify which creator partnerships are actually working.

3. Eroded Trust With Creators

Creators are told:

“Your code is driving sales.”

But in reality:

• Their code may be used by people who never saw their content

• Performance can spike or drop unpredictably due to leakage

• Commissions may later be questioned or adjusted

This creates confusion and mistrust and weakens long-term creator relationships.

How Coupon Leakage Usually Happens

Most brands don’t leak codes intentionally. It’s typically caused by:

• Static, reusable discount codes

• Long expiry windows or unlimited usage

• Affiliate platforms optimised for last-click attribution

• Limited visibility into where codes are actually being used

Once a code is indexed or shared externally, control is effectively lost.

A Real-World Example: When Discounts Escape Their Channel

A common pattern across DTC brands looks like this: A brand gives a creator a 15% discount code as part of a partnership. The creator shares it with their audience, driving genuine early traffic and sales.

Within days, that same code appears on coupon sites, gets indexed by Google, and is auto-applied at checkout by browser extensions.

Soon, shoppers who never saw the creator’s content — and were already ready to buy — receive the discount anyway.

The result:

• Orders are discounted unnecessarily

• Attribution is often assigned to coupon sites via last-click logic

• Creator performance data becomes inflated or misleading

The takeaway isn’t that these tools are “bad” it’s that once discount codes are exposed and reusable, control is effectively lost. What starts as a targeted incentive quietly becomes a sitewide discount.

What Smarter Brands Do Instead

Smarter brands are rethinking how incentives are applied and tracked.

Rather than relying on exposed, reusable discount codes, they’re moving towards systems that align discounts with real influence and keep attribution clean.

Leading brands are shifting towards:

Performance-Linked Discounts

Instead of relying on static, shareable coupon codes, modern platforms now allow creators to share discounts directly through their affiliate link.

When a customer clicks the link:

• The discount is applied automatically at checkout

• A unique coupon is generated for that customer

• The coupon can’t be reused, scraped, or shared elsewhere

This ensures discounts are only applied when real creator influence occurs, eliminating coupon leakage by design while keeping attribution accurate.

Controlled Incentives

Product gifting, limited-use rewards, or campaign-specific incentives rather than blanket public discounts.

Transparent Attribution

Rewarding creators based on genuine engagement and conversion impact not who happens to appear last at checkout.

This protects margins and builds stronger partnerships.

The Bigger Picture

Outdated discount mechanics weren’t designed for today’s creator-driven ecommerce.

Brands that scale sustainably don’t eliminate discounts they engineer them properly. They control how incentives are distributed, attribute performance accurately, and build creator partnerships on transparency rather than loopholes.

In a mature ecosystem, discounts should be earned through influence, not triggered by habit.