Will consumers wag the coupon dog?

Posted Apr 7, 2011, 09:38 AM by Rob Cleveland

I’m not much of a coupon clipper. Never have been. The scraps of paper, ever-elusive scissors that are never where they are supposed to be – all a recipe for frustration. And I can honestly say that I can’t remember ever being drawn to a product because of a discount in the Sunday mailer.

Having provided that disclaimer, marketers cannot avoid or ignore the collective growing power of digital coupons. The big nom du jour is, of course, Groupon. The company’s trajectory is high and fast and that success is drawing in some formidable competitors to the coupon and ad space.

And by formidable I mean one of the 800-pound social gorillas: Facebook and its real-time ads based on user wall posts and status updates. Facebook plans to try and steer ads your way based on your status or the comments on your wall. So “wish I had a pizza” generates some ads, and likely coupons, for your local pizza vendors.

Captain Nelson never had it so good. I want something, I type it into Facebook and it magically appears (well a discount anyway).

The big question for retailers and other purveyors of services online: are these really enticements for new customers to try your product or just a reward for someone who was willing to go the extra yard to track down a coupon for something they were already going to buy anyway?

That’s always been the conundrum in the coupon business. But now, instead of parsing through the Sunday paper and diligently storing those paper coupons away, consumers can quickly hop online, throw a few keywords around, and likely shake loose a discount in just a few minutes.

The remedy is to look at coupons as a bribe – yes I said it a bribe. It can be subtle – requiring users to go to a website to download the coupon, where other fantastic deals, products and services can be highlighted, perhaps for a future, undiscounted purchase.

Or coupons can be contingent – clippers must be registered via email, or be a fan on Facebook. This way, the retailer opens up a direct method of communications for the money being offered, hoping that future, direct solicitation will bring in additional sales.

That, however, will require some degree of sophistication on the part of both the coupon service and the retailer. Sharing/merging data and functionality between two disparate platforms and parties never is easy. Even setting up “like coupons” on Facebook is a chore. It’s made more daunting when retailers with unsophisticated web platforms get into this business. But hey, that’s what digital technology agencies are for….