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September 2nd, 2008

Coupons Should Cater Specifically to Consumers

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It seems all too often when leaving the grocery or drug store I’m handed my receipt along with a drove of coupons for either items I’ll never buy, or for items I’ve just purchased. Along the same lines, there’s nothing worse than that overstuffed envelope that arrives in the mail at least once a week, bursting with ineffective savings on products or services I never seem to have use for. Yet, there’s nothing better than clipping specific coupons for products at a store I shop at regularly.

Wouldn’t it be nice if, specially during these tough economic times — as wages have not yet caught up with inflation — if more stores and businesses catered their coupons specifically to consumers’ tastes in order to maintain strong spending habits? A survey conducted by Prospectiv found that 72% of consumers are using more coupons than they did six months ago.

What I found most interesting was that consumer sales could potentially increase significantly if all retailers were willing to offer coupons specific to a consumers spending habits:

The study also found:
* 80% said they would be very likely or likely to increase their use of coupons if they could be tailored to their interests and delivered online.
* 87% of shoppers said they would be more likely to shop at a retailer that offered coupons.
* And the good news for newspapers: 47% found print and online coupons equally convenient, while just 9% reported online coupons were most convenient.

As coupons catch up with the direct marketing capabilities of the internet, stores may have an easier job attracting customers and keeping them coming back by utilizing online coupons:

“If we fast forward, we are going to see most people getting coupons from the Internet, and that’s the preference of consumers,” Doyle said. “It’s much easier for them to get what they want online, and marketers are going to have to figure that into their plans.”

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4 Responses to “Coupons Should Cater Specifically to Consumers”

  1. Rebecca Wilder Says: September 3rd, 2008 at 8:36 am

    Interesting that the article does not address the cost to monitor and target the customers, which would likely be quite high. Price discrimination is not common (pricing according to individual demand) in most markets because one would need to know each person’s willingness to pay for each item. However, in this case, the grocery stores (let’s use grocery stores as an example, but clearly, this could apply to any store) already track individual demand with the store card (the card that I often forget, resulting in me not getting the discount or having to sign up for another one). They could easily process coupons accordingly. I don’t know if that is a good thing or a bad thing, though, because the buying history is likely to show up at some marketing group as well.

    Thanks – great article!

  2. Tim Manni Says: September 3rd, 2008 at 9:37 am

    Rebecca – The problem with those cards seems to me is their processing of information is limited to recognizing the items just purchased. I know that should logically make sense — give someone a coupon for something they just bought, they’re likely to buy it again — but for some reason it always frustrates me. I absolutely agree though, if retail computer systems could track, or even predict, our spending habits, we can only assume such programs would be quite costly, and thus would never see the light of day. Thanks for commenting, your insights are always appreciated.

  3. Michael Says: September 15th, 2008 at 2:25 am

    I don’t think it’s the retailers’ fault. It’s up to the consumer really, to exert the effort to find the coupons appropriate to his or her needs.

  4. Jerilyn Says: September 16th, 2008 at 3:15 am

    Our time is too precious to spend in a grocery store..! That’s way I always prefer online shopping with coupon codes.

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Tim Manni is the Managing Editor of HSH.com and the author of their daily blog, which concentrates on the latest developments in the mortgage and housing markets.

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