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Four Keys to Making Digital Coupons More Relevant

The great promise of digital couponing is delivering relevant offers to highly
targeted consumers — the right offer, at the right time, at the right place, to the
right consumer. The industry has been talking about this since the late 1990s,
but it hasn’t been until recently that this experience has truly become a reality.

Here are four keys to driving digital coupons in the future:

Target the Consumer Who is Always On
Consumers today are obsessed with being connected to the web – whether it is by desktop, laptop, mobile phone, tablet, or in the office, at home, on the go, or in the air.

Considering the way the market is progressing and morphing with technology allowing us to be mobile in every sense of the word, the way consumers use coupons is changing. In the days before smartphones and tablets, people searched for coupons in newspapers or went to the Internet to print them at home. This behavior will most likely continue as some consumers and brands remain adamant about having the tangible, tactile paper associated with the product on the scanner belt. However, adaptation to mobile is inevitable and will be dramatically accelerated once retailers and clearing houses sort out a process to scan and clear these electronic coupons.

The mobile explosion has gotten ahead of many retailers. Grocery retailers in particular are having a hard time redeeming mobile coupons on their traditional point-of-sale systems. The primary issue tends to be the lack of line-of-sight scanning at every checkout and the operational disruption that may occur in the lane by handing a mobile phone to a checker. Some have circumvented these issues by using a load-to-card approach, but that is problematic for organizations that don’t have loyalty cards or haven’t implemented a unique identifier at the transaction level.

Solve the Time-Consuming Coupon Experience
For most consumers today, digital couponing represents a hunt-and-seek experience. Customers search blogs, retailer web pages, social sites, mobile apps, and coupon aggregation sites for discounts and offers on products they want and need most. According to a recent study, 74% of consumers search multiple online coupon sources each week, and 25% spend up to an hour shopping for the best online discount deals.

Everybody wants to save money, but there is a trade-off between saving money and saving time. Couponing has always allowed customers to save money, but they had to take the time to clip and file coupons from the Sunday newspaper. As a result, many people conclude that their time was more valuable than the money saved from cutting out coupons.

Now with the digital representation of coupons, this task has become substantially easier. Coupons and discounts are everywhere online. However, couponing remains a time-consuming process. Why? Not because consumers have to clip and file, but because shoppers have to search everywhere to find relevant discounts on the products they want most.

This is setting up an interesting opportunity. Organizations that are able to give the shopper back those precious hours spent searching for relevant coupons will fulfill a monumental need. Coupon relevancy is King.

Ride the Power Shift Wave
Until a few years ago, digital couponing had been dominated by a handful of third-party coupon aggregation sites. Customers had to visit one of these sites to download offers.

Today this dominance is diminishing. Media is fragmenting and brands and retailers are offering customers access to digital coupons from their own properties, such as websites, Facebook pages, and microsites. Many brands and retailers are reserving their own properties to deliver the best offers. Consumers are taking notice and are starting to search for coupons and discounts on brand and retailer sites before scouring the web for offers.

Brands and retailers have noted the trend and have concluded: “We want the customers to stay on our page and on our own properties. We want to provide a better couponing experience and we are not interested in trying to drive them somewhere else to get a coupon.”

This is creating a three-way power struggle between coupon aggregators, brands and the retailers. Each is claiming rights to ownership of the customer.

Brands and retailers will only increase couponing and discounting on their own brand sites. Companies that want to be active players in the couponing space will need to finds ways to empower them in the endeavor, or run the risk of being cut out of the picture all together.

Leverage Consumer Data
Since the late 1990s, many retailers and brands have been mining and leveraging consumer transaction data to influence everything from store operations to marketing communications, with the concerted effort to drive more sales. A key component of this mining and analysis is coupon history. Knowing how often consumers use coupons and the specific categories they redeem has helped brands and retailers create smart customer price sensitivity models. Knowing what items a family is price sensitive to, or not price sensitive to, provides an incredible amount of power to deliver the most relevant offers, and avoid cannibalization of sales.

The embodiment of these efforts from the marketing side has been direct mail, as it allowed brands and retailers to send personalized 1-to-1 messaging to shoppers. Unfortunately, direct mail is expensive and consumers are dramatically shifting their attention away from their mail box to their in-box. This has led brands and retailers to quickly turn their attention to digital couponing and promotion platforms.

With shoppers now being constantly connected, and with the speed and efficiency at which digital offers can be delivered to consumers, many brands and retailers are creating dynamic digital experiences that deliver personalized 1-to-1 messaging.

The future of digital couponing will allow consumers to receive the right offer, at the right time, and at the right place. Companies that leverage transactional data, digital coupon history, and location/proximity marketing will create the optimal digital couponing and shopping experience. Transaction data will be used to determine the right price and product for each consumer. Digital coupon history will help companies know what products and categories consumer have shown price sensitivity to. Location/proximity information will allow marketers to deliver the coupon at the appropriate time during the path to purchase.

The above article was based on conversations with Wade Allen, president, CouponFactory. The
Dallas-based company operates a highly secure couponing platform that allows businesses to create, manage, deliver and measure their digital coupons quickly and easily. For more information: visit and,  or email