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4 Trends That Signal A Digital Coupon Revolution in Retail
A significant shift towards increased accessibility, ease of use, and personalization is paving the way for future-forward, mobile couponing strategies.
Coupons date all the way back to the late nineteenth century when Coca-Cola launched the first-ever coupon campaign in 1888. While times have certainly changed since then, the impact that coupon marketing has had on retailers and CPG brands is still as significant as ever. Even with over 135 years between the initial introduction of the coupon and today's coupon market, at the core, the benefits of couponing are very much the same: a relatively affordable marketing tactic to attract and retain customers, bolster loyalty, and drive revenue by increasing the frequency of customer purchases and visits.
Everyone knows what a coupon is, but to what extent do customers of the twenty-first century know just how easy it can be to obtain, collect, and redeem? Here are four recent trends we're seeing with coupons that indicate retailers and CPG brands must be prepared for a digital coupon revolution—because it's already here.
1. There's a massive shift in digital coupon redemption as customers increasingly expect deals to be available online and on their mobile devices.
By the end of 2022, digital coupon redemption grew to over $40 billion, with growth rates expected to accelerate by more than 50% by 2025. As today's customers shift their coupon preferences online, they're looking to retailers and CPG brands to follow suit. Although more than three-quarters of customers already use paperless coupons—a number that's notably higher for the Millennial age group (93%)—over half of all customers, in general, express a greater desire for digital deals and prefer coupons and discounts to be sent directly to their mobile phones. In fact, 59% of shoppers say they would like to receive coupons straight to their mobile devices more often if they came at no additional cost, such as through texts and SMS push notifications. Subsequently, 61% of customers are more likely to purchase a product from a retailer or brand if they first receive messages about their promotions.
2. Digital coupons are easier to find, access, and use, giving customers plenty of time to redeem promotions at the right time and place.
Nearly half of all non-coupon users attribute time as the primary cause for their lack of interest in using coupons. Specifically, over 60% of customers say their coupons expire before they ever get a chance to use them and 49% state that it takes too much time and effort to find them. Surprisingly, many shoppers spend over two hours per week looking for deals.
But in today's day and age, the hunt for deals is becoming much easier and much more timely, which is in line with the fact that 63% of consumers say they would increase their coupon usage if their desired offers were available online. Thanks to digital coupons, both print at home and with the new AI (8112) Universal Digital Coupon Standard, as well as online couponing websites, forums, and communities, customers everywhere are finding and collecting a wide variety of coupons like never before.
3. Digital loyalty programs and social media platforms are key drivers for customer coupon usage.
Over 90% of customers will consider joining a brand's loyalty program if it means that they will receive a discount, whether for one-time use or recurring offers, and 70% believe that coupons breed brand affinity as a result. Loyalty passes are also an effective way for customers to pin relevant coupons—and not forget about them—as most customers load their digital coupons directly onto their frequent shopper and loyalty points cards.
Not only do digital loyalty programs help customers establish trust and a sense of community with your brand, but they also foster a significant increase in customer lifetime value (CLV) by keeping customers coming back, expanding the opportunities for consumer referrals, and enabling you to positively influence their purchase decisions. In a 2021 report analyzing how brand loyalty impacts CLV, which surveyed over 7,500 online shoppers, 87% of customers cited that their top reason for increased purchase frequency was regular discounts and coupons offered to existing customers.
When it comes to the power of social media platforms, over 70% of customers say they have followed a brand to see if they can get deals or discounts before committing to a purchase. In turn, 67% of brands have used social media to announce flash sales, coupon offers, and product discounts.
4. Coupons play a large role in influencing customer behavior, and the availability of digital coupons only makes it easier to buy more (and more frequently).
It's no secret that coupons are cost-savers for retailers and customers alike; 72% of shoppers believe they can save the most money when they purchase with coupons. As a CPG brand, coupons can help you meet your customers' demands while offering a cost-effective way to attract, engage, and retain shoppers. When 62% of customers check store circulars for coupons to match items on their shopping list, a significant opportunity presents itself to ensure that you make the sale. 65% of consumers routinely plan what to purchase based on available coupons, while the availability of a coupon or discount has influenced 69% of shoppers to make a planned or unplanned purchase. In general, coupons are a great way to encourage customers to add more to their carts than they otherwise would.
Future-Proofing The Retail Coupon Market
Since the beginning, coupons have remained tried and true. With its initial success of reeling in customers and driving sales growth, this same sentiment is still shared to this day. Amidst the push toward a completely mobile world, complemented by the growing demand for AI (8112) Universal Digital Coupons, we're already seeing how the traditional couponing ecosystem is being revolutionized to enhance the experience for both shoppers and CPG brands. Digital coupons are no longer just an expectation of the future, and it's time for retailers and brands to quickly jump on board before they get left in the past.