Is the future of coupons mobile?

Judging by the increasing size of the Sunday advertising insert package, the fall season is in full swing and the holidays are quickly approaching.

Two years ago, I wrote about predictions of impending doom for the pre-print industry. Well, here we are two years later and pre-prints show no sign of slowing down. While other alternatives do exist, advertisers and print media outlets have still not found a completely workable digital replacement for free-standing inserts (FSI) or, more importantly, coupons.

Print coupons continue to reign supreme, but electronic options are growing, and news media companies need to be ready and able to adapt.

While “extreme” couponing is somewhat of a fad that has come and gone, coupons continue to be popular, according to the 2015 industry promotion analysis produced by Inmar, a technology company that tracks and reports on the promotions industry. The report, which can be downloaded here, indicates that 2014 coupon usage remained steady compared to the previous five years and that the overall value of coupons was up 6.4% over 2013. 

The survey shows that 65% of shoppers indicated their coupon usage remained consistent with previous years, and 27% reported their usage has increased thanks to digital alternatives such as load-to-card. Redemption of electronic coupons has grown 100%, although this represents only 1.8% of the total.

At the same time, redemption of print coupons fell to below 39% in 2014, down from 43% in 2010. Still 90% of coupons are still distributed via free-standing print inserts, so there’s no need to panic.

The immediate future of coupons and couponing seems secure as the youngest adults, Millennials, are avid coupon users. According to a survey by Valassis, 90% of Millennials use coupons and half of these indicated that they had increased their use of coupons in the past year.

And the good news is that 49% say they prefer clipping coupons from the newspaper or receiving them in the mail. This is far less, however, than the 67% of Baby Boomers who use print coupons.

Tech-savvy Millennials use digital options far more than previous generations. According to a survey by, two-thirds of Millennials believe that personalised, digital coupons are the wave of the future.

Retailers continue to look for ways to reduce the number of printed coupons they distribute. The cost of designing and distributing printed coupons is very high given the relatively low redemption rate.

Many retailers, especially grocers, are testing electronic coupons on their Web sites and through apps, or simply distributed in-store via print or directly to smartphones.

In fact, many grocers are offering the option to order groceries online and providing coupons during the process, thus eliminating the in-store coupon experience all together.

Mobile coupon audiences are growing. According to a survey by Statistica, adult mobile coupon users are projected to reach 104 million in 2016, a 70% increase from just three years ago. In addition, 90% of all mobile users will look for a coupon next year.

In fact, 70% of all consumers want a coupon for products they buy most, and they want these to come in the form of personalised coupons sent to them by the retailers they buy from.

As smartphones continue to develop and as other technology such as wearable mobile electronic devices (i.e. Apple Watch) become more popular, the next wave of couponing will likely come in the form of data-driven, geographic targeting. Search will also be an efficient method for retailers and manufacturers to get their coupons into the hands of people who will use them.

News media companies need to be on top of this creative disruption. Marek Miller wrote an INMA blog post a couple of weeks ago about the Norwegian newspaper, Verden Gang, which recently tested location-based technology on its mobile app. It partnered with Coca-Cola and a local cinema.

When viewers arrived at the theater, they were presented with a coupon for a free Coca-Cola at the snack bar. After returning home, users were presented with an offer for a free movie ticket with the purchase of a ticket. The test resulted in 12% redemption at the snack bar and 16% returned to the theater and redeemed the free movie ticket. 

There are many companies offering digital coupons and promotions, and some have been around for some time. Groupon, for example, is one of the most popular coupon Web sites and currently gets more than 30 million unique visitors each month.

There are emerging companies, as well. Thinaire, Couponomy, and Retailmenot are just three new companies competing for retail ad business.

Again, while they currently make up just a small portion of couponing, they represent a rapidly growing industry.

Tech-savvy Millennials will be very receptive to new couponing technologies, and print coupons may seem like a distant memory to their offspring.

News media companies tend to have an unfortunate habit of being reactive rather than being ahead of (or even leading) innovative changes in advertising, which has contributed to the slow adaptation of digital and mobile technologies.

If they are to survive the next creative disruption, which possibly could involve free-standing inserts and coupons, they need to be more proactive in entering and occupying the digital, mobile, and targeted FSI space. 

Hopefully we learned a lesson from the rapid decline of classified advertising. While print FSIs and coupons continue to dominate today, when the right mix of technology comes along, they are likely to experience the same freefall.

About Dan Johnson

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