The coupon craze shows no signs of diminishing and mobile coupons are set to transform the retail sector over the next year.
Penny Dryden, commercial director of the UK’s coupon experts Valassis, explains the rise and rise of coupons.
Consumers are deal hungry and this appetite shows no signs of waning. Our recent figures show that 275 million coupons were redeemed in the first half of 2013 alone - a 38 per cent increase in volume on the same period in 2012. If the current coupon uptake continues at the same rate, the total value of shoppers’ savings in 2013 is estimated at a staggering £1.7billion.
So why, in a more prosperous climate, are shoppers still chasing bargains and cashing in more coupons than ever?
There is a strong argument towards the fact that consumer behaviour is so entrenched that the coupon craving is hard to give up. We have seen evidence of this in the US where the economic downturn put a wide swath of consumers on the money-saving path. Coupon collecting continues to be a very popular household activity with a rise in ‘clipping parties’ across the States. Although the climate has since seen an upturn, this strong pattern of behaviour has become engrained.
Retailers both in the UK and across the pond have responded to and fuelled this behaviour, turning dramatically to coupons as the key way to guarantee lowest or matching prices in order to attract and retain customers. They are increasingly competing for individual shopping trips given that consumers are inclined to switch shops in order to bag the better bargains.
This coupon centric behaviour looks set to increase further this year with the rise of digital tools which help to make bargain hunting all the easier. While print coupons still dominate, the use of digital coupons is rapidly rising in popularity. eMarketer estimates that 100 million US adults will be digital coupon users by the end of this year.
This type of coupon is set to make a big impact in the retail sector, offering both advantages for the retailer and the consumer. Mobile coupons will be the ultimate in convenience for the shopper, being easily accessible via a smartphone and therefore available where and when consumers want to access them. This format also reduces the risk of losing or forgetting coupons.
From the retailers’ point of view, mobile coupons reduce the overall cost as they are less hassle to handle, cheaper to process, and if the redemption transaction is handled correctly, these type of coupons will be more secure than paper coupons – the risk of misredemption is reduced as it is more difficult to copy or use the coupon more than once.
Smartphone adoption is rapidly rising (almost half of all adults now own a smartphone), and they are now an extension of people’s lives - it’s the device through which they shop and interact with people, shops and places. Consumers are now accustomed to researching products, comparing prices, sourcing and redeeming digital offers on the high street. Retailers should look at ways of tapping into these lifestyle behaviours, in order to secure spend and attract and interact with their customers in innovative ways.
 Over a quarter of adults (27 per cent) and almost half of teenagers (47 per cent) now own a smartphone, according to Ofcom’s latest Communications Market Report.