Digital Coupon 'Events' Take Off

by Erik Sass, Jul 26, 2010, 5:00 AM

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The number of special product promotions featuring digital coupons increased 84% between the first half of 2009 and the first half of 2010 -- largely thanks to new marketing initiatives via retailer Web sites and social media, according to Kantar Media, which operates a Web site-tracking service called Marx.

The surge in special coupon "events" accompanies a massive increase in the total number of digital coupon redemptions over the last year.

Focusing in on retailer Web sites specifically, Kantar-Marx found that the number of manufacturers staging promotion events with digital coupons (268) surpassed the number using traditional print freestanding inserts (213) -- another sign of their growing popularity.

Marx Vice President of Sales Bob Cristofono stated that "manufacturers are distributing coupons on retailer Web sites to build purchase intent with the consumer and drive shopping trips for the retailer." He says manufacturers need to understand "competitive promotion activity on retailer Web sites to fully understand retail pricing, merchandising support and promotional lift."

However, special promotion events for new products still lean heavily toward print as opposed to digital coupons.

In the first half of the year, 196 new products were launched with print freestanding inserts, versus just 35 launched with digital coupon promotions. On the other hand, digital promotions for new products tended to have more installments, with 6.1 "event dates" for online promotions versus just 1.6 "event dates" for print FSI events.

Kantar-Marx attributed the increase in digital coupon events in part to increased use of social media by manufacturers, including consumer packaged-goods companies -- especially Facebook and Twitter.

Companies that issue digital coupons encourage users to visit social media sites to download additional savings, join Web clubs and contribute to charities.

Separately, the last year has also seen a big increase in the number of digital "groupons" -- communal coupons, often issued by small, local businesses that require a certain number of people to participate before the promised discount is activated.

This gives an incentive to consumers to recruit more people to participate in the "groupon" promotions, which are now being offered by local publishers on behalf of local businesses.

For example, Philly.com (the online portal for The Philadelphia Inquirer and Philadelphia Daily News) launched a "groupon" site called PhillyDealyo.com, which will allow restaurants, retail venues and various service businesses to offer group promotions to Philadelphia-area consumers who subscribe to the site. Subscribers will receive email alerts about new and ongoing "groupon" promotions.

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