Here’s why online based coupons don’t work…. #loyalty #retail #startups #bigdata



Digital Witnesses

Digital coupons, yup been there. Digging into the numbers you can see a very odd number. With all the talk of digital this and digital that and digital around the corner, digital marketing and digital gurus, answer me this. Out of the 171,000,000,000 (yes, one hundred and seventy one billion) coupons distributed in the US last year, how come just over 1% was “digital”?

You read that right, one percent. 

A whopping 92% were print coupons, not personalised, not to smartphone, didn’t have my name on it. They were blanket distributed, in print, the ones that old folks like, coupons.

The rationale in the retailer’s eyes is very simple, for the larger ones especially, the cost of distribution is far cheaper in print than it is online. So from mud-splatter-wall point of view it’s more cost effective to send out en masse to as many people as possible, remember it’s coupons.

Are You POS Ready?

Distribute a million coupons with one SKU barcode and you can measure. It’s like banner advertising with the same sort of analytics.

  • I’ll know what store it was redeemed in.
  • I know what date and time it was redeemed.

I know how many the marketing department paid for (think cost per thousand impressions in digital speak) and you can easily work out the redemption ratio. Even better, beating digital hands down is one simple metric.

  • I can associate a final basket cost with the coupon.

And at that point all bets are off, the job is done as the money is in the till. For any coupon thing out there there’s a huge win if you integrate with the POS company. There’s a bigger win if you OWN THE POS company. Look at Groupon, Open Table and Just Eat, they went to great lengths to acquire point of sale companies to forward push their own systems.

It’s 2014 Jase! C’mon!

Having acquired the “been there and done that” t-shirt, with matching hat, gloves, scarf, long johns, pants and other apparel, I’ve championed the digital coupon, it didn’t work for me and I know some of you are thinking I’m just being negative. The harsh reality is that 1% while being over a billion coupons isn’t a large enough pull for the likes of a large chain. The mud/wall theory still stands and it will for a good few years yet. While print is cheaper than digital distribution in uberlarge volumes digital has a long way to go.

And at this level loyalty and personalisation doesn’t even get a look in. That’s just fanciful aside.



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