Digital Coupons: Audience and Redemption Growing Rapidly
“People engaging in digital offers is predicted to reach ~51 million next year, and with 10% redemption rates (paper coupons are 1%), marketers are actively deploying digital offers as a way to monetize mobile as the mobile industry continues to explode,” said TJ Person, CEO of Koupon Media.
Numerous benefits exist with digital coupons and as a result they are quickly gaining acceptance, resulting in rapid redemption rates. Here are some of the advantages to using digital coupons and benefits to both businesses and consumers:
- Research conducted in October 2013 by eMarketer indicates that more than half of US adult internet users (102.5 million people) will redeem a digital coupon, for either online or offline shopping this year.
- That number is up 11% over last year and the number of people redeeming is expected to keep increasing with the primary area of growth being the new mobile coupon user.
- Digital coupons are a great way to engage the new user because you can provide a direct link to your products or services via the coupon.
- Digital coupons not only afford your business more visibility, but they can also help the conversions on your website and/or increase traffic to your store.
Mobile is Key
The digital coupon has been around for years, but didn’t really take off until mobile devices became more commonplace. Mobile plays a significant part in digital couponing.
– This year, more than 28% of people who own a mobile device have redeemed a coupon and according to eMarketer, it is expected that one-third of all smartphone users ages 18 and up (42.1 million people) will use a coupon acquired on a mobile device –via an app, mobile internet, mobile barcode or SMS.
– The US smartphone coupon user base is up 40.9% this year, following 60.6% growth in 2012.
– The digital coupon is no longer about the price-conscious consumer. The recent recession and rapid adoption of the smartphone, have helped push digital coupons to a more diverse and mainstream market.
– The number of people who redeem digital coupons is only expected to grow as consumers ditch their paper coupons for the convenience of digital.
What’s fueling this growth? There are several key factors involved:
– For one as aforementioned, the increase in new smartphone users. The number of people who use iPhones, iPads and Android devices continues to grow at a phenomenal rate and is not expected to slow down any time soon.
– Another growth driver is the increasing popularity of new mobile apps and local deals from sites like Amazon Local and Groupon that feature discounted gift certificates to use at participating businesses locally and nationally.
– Lastly, and probably most notable is the growth coming from the integration of couponing into social networks.
Nowadays, businesses are using Facebook, Twitter and other social network sites to help their coupon offers go viral, giving marketers excellent opportunities to promote their products and sell digital coupons offering benefits such as discounts or free trials. They can give away the coupons to increase engagement and ROI.
This exposure for the products or services that you offer gives you the opportunity to capture the attention of a large audience of potential customers. Often times, advertising fails simply because people do not take the trouble to actively see or read the advertisement. Offering digital coupons is a way of putting the offer directly into the customer’s hands, customized by their interests, while also achieving your business objectives. The integration of digital coupons is sure way to arouse interest with your target audience.
How It Works: Redeeming Digital Coupons
The process is convenient and eco-friendly! You don’t need to print a coupon out on your computer to bring into a store for redemption. Instead, digital coupons and offers can be redeemed right from your mobile device. An increasing number of consumers are using smartphones to access and redeem coupons both online and in person. They are finding deals through a variety of channels, which include mobile apps and mobile browsers, social networks, email, SMS, barcode scanning, and push notifications.
The best digital coupon applications out there are Apple’s Passbook® (available on iOS operating system iOS 6 and up) and Android’s version of the same app called PassWallet. These apps come standard on all smartphones running on these operating systems, meaning the app is already pre-loaded on from the date of purchase. According to ABI Research, that is equivalent to being active in over a billion smartphones worldwide! These apps are unique as they allows users to store multiple items such as digital coupons, boarding passes, movie and event tickets, retail store cards, gift cards, loyalty cards and other forms of mobile payment. They are all categorized and easy to use. All you need to do is scan a barcode from your smartphone or tablet to check in for a flight, enter a movie, use a gift card, redeem a digital coupon, and more. It’s that simple.
Another very innovative feature, that uses location notifications, can be implemented to target a who has your business’ digital coupon or offer stored in his/her Passbook and is nearby your location. Basically, their smartphone will vibrate or sound to notify them, passing along a gentle reminder that “hey, you have a deal near you.” Similarly, when your boarding pass is loaded in Passbook, and a flight is getting nearer, you will get a reminder notification when it’s nearing the time to board your flight.
For those with mobile devices not running iOS or Android, there is a solution. There’s a new mobile marketing platform available that allows you to create and send Passbook passes to phones that do not support Passbook or PassWallet app. This platform immediately detects if the mobile operating system supports Passbook and modifies accordingly, prompting user to download to view the pass in an HTML version on the landing page. The only feature lacking from this HTML version is the ability to provide location notifications.
Digital coupons are convenient, discreet, enable positive customer experiences, and are eco-friendly! Make them a part of your mobile and digital marketing strategy to give your business more exposure and help capture the attention of an expanded group of potential customers.
Statistical Source: eMarketer, Oct. 2013