The customer places an order. When you mark it Complete, any matching rule creates a code.
They receive an email "Your exclusive discount coupon!" with the code, the discount (e.g. "10%" or "₹100") and the expiry date.
On their next visit they enter the code in the coupon box in the cart or at checkout.
If the cart meets the minimum and the code hasn't expired, the discount is applied.
Good to know
Codes are not shown in the customer's account — only in the email. If a customer loses it, look it up under the rule in Auto Coupons and send it to them.
Only customers with an account and email get the email. Guest orders don't.
Messages a customer may see at checkout: the code is invalid or expired, the cart is below the minimum, or the code was already used.