Virtual beats paper: Why consumers want digital coupons

Dive Brief:

  • New analysis from Inmar shows that out of more than 2.2 billion coupons redeemed by shoppers last year, those loaded directly to retailer loyalty accounts (Load-to-Card) increased 20% between 2015 and 2016, according to Retail Leader.
  • The report also showed that shares of redemption for paper coupons found in the Sunday paper decreased 10% over the same period.
  • Load-to-Card (L2C) coupons grew to a record redemption rate of 6.2% in 2016.

Dive Insight:

Coupons — whether paper or digital — are still a major part of the grocery shopping experience for many consumers. A recent study by Forrester Research found that 79% of shoppers said they wouldn’t buy an item if they forgot to bring the corresponding coupon to the store with them. Digital coupons have a huge advantage here — there's no chance of an online deal getting crumpled up in the bottom of someone's purse or left on the kitchen counter. 

A study by RetailMeNot also revealed that 96% of all consumers use coupons, and the number of American shoppers who utilize mobile coupons has been increasing every year.

In its "Coupon Intelligence Report", Valassis noted that 9 out of 10 millennials use coupons regularly, and an increasing number are redeeming them through digital channels.

This shift toward digital coupons poses both a challenge and an advantage to retailers. The good news is many shoppers are still bringing their digital coupons to brick-and-mortar stores to make their purchases. But if grocery chains don't quickly maximize digital coupons, they could lose some of their consumer base  — particularly the millennial demographic — to more digitally savvy stores or grocery e-tailers. 

Digital coupons also allow grocery stores to better target consumers with deals on the products they want through online data, which can entice consumers to try new products. They can also help retailers direct consumers to new products. A study by Quotient Technology Inc. showed that digital coupon users are more likely to try new items and buy them regularly if they have a coupon to use for their initial purchase. 

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Filed Under: Grocery Marketing