How coupons have re-emerged in a digital age
Coded coupons were used by Claude Hopkins in 1909 to test consumer responses to headlines and promotions. Hopkins is often credited with being the father of direct marketing. As coupons re-emerge in today’s digital world, marketers would do well to read his book, Scientific Advertising. You have to love a marketer that measures results!
Coupon clipping in frugal times
During the US depression in the 1930s, coupons surged as a marketing tool. Shoppers became extremely frugal and used coupons to find bargains and stretch budgets. During the depression, coupons were found everywhere in print – newspapers, magazines, inserts and even in flyers. Coupon clipping literally became a way of life for consumers to save money, and for marketers to track and measure results.
When the economy improved, coupon clipping diminished as shoppers were not as pressed to save nickels and dimes. With the advent of EDLP, there was no need for paper discount coupons, at least at Walmart. However, as the current economy again stresses family budgets, the “old marketing” of coupons has re-emerged, especially in the new digital media.
Couponing in a digital age
Coupons have traditionally been associated with groceries and packaged goods items. And, Nielson data indicates that coupon clipping is in vogue again in the US. Nielson reports that 1.6 billion coupons were redeemed in the first half of 2009, which is up 23% year over year.
While most of the consumer packaged goods coupons are still coded paper, there is an evolving trend toward digital. It is now estimated in the US that 40 million people print online coupons. With pioneers like JC Penney and others now accepting digital coupons on phones, many future coupons may in fact never get printed. This is already the case with digital coupon redemption at internet shopping carts.
Do your own simple online test of digital coupons
Coupons may not be as “sexy” as other visual media, but they are highly valued by consumers. Most importantly, they drive sales. The “coupon moms” of today not only value the savings discounts, but highly value the convenience and time savings of being able to search and redeem digitally. In fact, the major digital break through has been digital coupon consolidation sites.
Still wondering if this applies to your business or consumer electronics? Do your own personal test. Go to Google or Bing and type in “coupons” and a category like “electronics”. Look at how many digital coupon consolidation sites like “CouponCabin” and “CouponMom” emerge. Indeed, one of the core value props behind Bing is “Cashback”.
Results Count … especially with digital coupons
There is ample evidence to indicate that coupons can and do drive sales. With digital couponing rapidly increasing, coupon reach to more consumers is increasing, as well as redemption rates. All good for consumers, but what do marketers get?
Today’s marketers would be well advised to go back and read Hopkins book Scientific Advertising. Hopkins original genius was “coding” the coupons so that he could measure the results of different headlines, offers and messaging.
With digital coupons today, there is a multitude of new opportunities to collect marketing data about the consumers using them, where they are using them, and to systematically test what works best where. At a minimum, today’s marketer using digital coupons must do more than merely discount price and measure sales.
Just like in 1909, the ability to measure coupon impact hinges on systematic coding, testing different variations and tracking sales results. If you are not measuring at least some of the following, you are not harvesting key insights and value of coupons in today’s digital world:
· What is the original source of the coupon?
· Did the consumer go through search engine(s)?
· What are the most effective means to directly deliver coupons?
· Where do consumers redeem digital coupons?
· What factors / attributes most affect redemption rates?
· In addition to the coupon item, what else is in the basket?
· What is the incremental sales and ROI impact of different offers?
Perhaps coupons never really went away, at least with consumers. Coupons are not as sexy as “flash & splash” of other digital media. But, the data suggest that coupons, especially digital, have become a major factor in driving retail sales both online and in-store.
Today more than ever … Results Count! Today’s marketers would do well to rediscover the power and insights that coupons can provide … IF there is systematic measurement of attributes that drive profitable results.
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