Do South Africans use coupons?

I’d turn on the coffee maker and sneak downstairs in my jarmies to collect the newspaper - which was fat and juicy, with inserts galore. The “news” part of the newspaper usually went unread. The scissors came out and the hunt for fabulous goods was on.

Coupons for coffee shops, Levi jeans, household cleaning items, Coca Cola specials and onions rings with your next oversized tub of babyback ribs and French fries piled up around me. Happily - and unlike here where the ad appears on a Friday and you hit the large department store on a Saturday and they’re “sold out” - American stores have a “rain check”. If the item on your coupon isn’t available, you get a “rain check” and can come back at any time for the item at the reduced price. No, really.

The closest I have come to “coupon shopping” in South Africa is when the Soap Powder Lady hands me a “20% off” deal in the cleaning aisle at my local store. Do South Africans not use coupons? Are we afraid of them? Or has our long history of “sorry, we sold out three minutes after that ad was printed” just put us all off altogether?

Take a look at how well online coupons are doing in the USA. According to the latest Online Shopper Intelligence survey, one-third of online shoppers surveyed said they generally use coupon sites while shopping online. 35 million - THIRTY FIVE MILLION - consumers visited coupon sites in April 2010, up 5% from the previous year. Mediapost.com says that besides the consumer benefit, coupons have a significant impact on retailers’ bottom lines.

More than half of the consumers who used a coupon code during their last online purchase said that if they had not received the discount, they would not have bought the item(s), suggesting that coupons can be a highly effective sales driver.

In response to the question “If you did not have a coupon, would you have made a purchase…” respondents answered:

* No… 57%

* Yes…43%

Coupons have a high ROI, concludes the report, as the small discount consumers receive encourages them to spend money. When asked how much they spent on their most recent online purchase, consumers who used a coupon spend almost twice as much as consumers who did not use a coupon.

How much did you spend? (average spend on most recent online purchase)

* With coupon… $216

* No coupon… $122

(Source: Compete, June 2010)

The study also says coupons are an effective way for retailers to build good will with their consumers and increase customer satisfaction. When asked about their overall shopping experience, satisfaction was higher for consumers who used a coupon than for those who did not. Those who used a coupon said they are more likely to buy from the retailer again when compared to those who did not use a coupon.

So . . . an opportunity for some branding on the coupon; another to get someone into a store; another to get them to try your product and perhaps become a loyal buyer. Why aren’t we taking full advantage? Anyone?

Today’s newsletter asks you to tell us who should replace Mansfield; takes a look at a case study by PenQuin International; and brings you info on the Vuvuzela app for your iPhone, for when we all start missing it . . . Enjoy!

By Dianne Bayley

Research Reveals Overwhelming Consumer Interest in Mobile Vouchers

In an independent survey undertaken on behalf of Mobilitrix and Shoprite, over 68% of participants said they are “very interested” in receiving mobile vouchers. The sample of data was taken from a cross section of Shoprite and Checkers customers in the first ever mobile voucher study of its kind undertaken in South Africa.

43% of respondents indicated they “mostly received” in-store paper coupons, with a further 13% using general paper-based coupons and an additional 18% mostly receive vouchers in the form of gift cards. The latest findings mean that CRM campaigns are now set to be more targeted using the mobile vouchers as a tool to drive new customers into stores specifically those mobile users who are keen to gain discounts on a range of retail products relevant and targeted to them.

Potential customers wanting anything from coupons for dish washing liquid to vouchers on general foodstuffs will be able to choose to engage with those retailers offering rewards and developing loyalty relationships with consumers. The consumers are then able to redeem each mobile voucher they receive in stores at the point of sale. Developing new types of customer loyalty through continued mobile voucher offerings, combined with increasing specific sales has made the overwhelming consumer interest in mobile vouchers even more relevant in today’s marketing world.

Mobile vouchers and coupons receivable via mobile phones do not require any additional software on the phone as the voucher is delivered using SMS, so it’s simple for the consumer to understand; from the retailer side, they do not require new hardware of scanning devices to start using mobile vouchers and the system is designed to work around existing point of sales. Commercially this signifies the first opportunity for brands to engage with the majority of the South Africa market in dynamic one-to-one marketing manner. As brands connect directly with their customers through mobile vouchers, the loyalty factor is significant, with immediate rewards for the customers and invaluable consumer-related information for the retailer.

Furthermore, while achieving direct sales objectives, intelligent and targeted voucher distribution allows for real-time reporting and ROI measurability on all media spend, specifically out of store spend. The seamless integration coupled with cost effectiveness is set to save millions in conventional advertising expenses, while exacting invaluable customer data without the traditional time lag inefficiencies.

“It is interesting that food was the number one item that consumers requested mobile vouchers for according to the research,” notes Mobilitrix CEO Chris Rolfe. “Obviously food is a broad area, but it suggests that consumers want vouchers for the big FMCG retailers, the fast food industry and other specialist food retailers” Rolfe added.

With research showing some consumer education is needed when it comes to moving customers forward on the “how to” of using a mobile voucher, Rolfe says “it’s a simple challenge when compared to significant advantages for those retailers who get it right from the start and begin to build targeted databases of their customers.

The research clearly indicates that consumer demand is there for mobile vouchers and coupons and the market wants to engage digitally with brands using their mobile devices. For those retailers and brands with high numbers of cash customers, this must be music to their ears.

Success for Mobile Coupons Begins at the Register

One of the more interesting discussions I had with attendees at the ReadWriteWeb Mobile Summit a few weeks ago was about the future of location-based mobile advertising and why it has so far failed to take off. The speed-bumps we uncovered during that session included the burden of building an ad network and finding unique ways of engaging users, but one other key hurdle that stands in the way is the physical interaction at the point-of-sale.

Nic Brisbourne, an investor at DFJ Esprit, hit the nail on the head this morning with his blog post, “Point of sale redemption is key to mobile vouchers/codes.” As he points out, mobile coupons have been a common idea for startups over the last decade, but it hasn’t been until now with current smart-phone technology that the idea has seemed relatively viable. The other factor that he says is pushing the mobile voucher market is support from major vendors.

“US retailers Kroger and Target have begun issuing money off ‘digital coupons’ that can be downloaded to mobile phones and scanned against purchases at the store check out,” writes Brisbourne. “Similarly in Japan at McDonald’s users can download a coupon and then wave the phone over a reader at the till to receive a discounted price, and if they are on the right network they can even have the cost of the meal added to their mobile bill.”

Another large retailer using mobile coupons is JCPenny, which teamed with coupon provider Cellfire last year. Users can sign up at the Cellfire site to receive coupons directly on their phones which can be scanned at JCPenny stores using a special Motorola image scanner.

With support from these large corporations, mobile vouchers may be set to take off into the stratosphere, but there are a few other things standing in the way. It takes more than just a vendor agreeing to support the coupons; they must also update their point-of-sale systems to support the various types of scannable codes that could be used, such as quick response (QR) codes.

There is also the human aspect of the equation. While a large store like Target may be open to this type of marketing, they are tasked with informing and educating their entire staff of check-out clerks and managers on the new technology. I’ve heard more than a handful of people tell me they have had to convince a store clerk of the validity of their coupon when attempting to use a mobile voucher. Fortunately, as time goes by and more people begin using these coupons, the clerks working the point-of-sale will be more aware of them, but for now, this is still a significant obstacle to their success.

With this market seemingly ripe for the taking, there is a huge opportunity for startups to provide either software or hardware to ease this transition and make it widely available. Brisbourne points out that the software side is a new spin on an old online business model.

“The obvious consumer oriented startup opportunity lies in driving people into real world stores by getting them to download coupons onto their mobile phones, and then taking a slice of the transaction - this is in many ways a real world parallel to the online affiliate network opportunity,” he says.

I also agree with Brisbourne that the point-of-sale is the single most important factor of the mobile coupon market. All the partnerships and ad networks in the world are useless if the technology isn’t in place to make the process simple and easy for both the customer and the clerk working the register.

Written by Chris Cameron / May 18, 2010

It’s Time To Make All These Printed Discount Vouchers Go Mobile

As you may have noticed in the last couple of years there has been a surge of popularity in online discount vouchers in the UK. A week doesn’t go by without a voucher for Gap, GBK, Ask, Urban Outfitters or H&M landing in my inbox.  All you have to do is print them out and take them in-store. Sites like Money Saving Expert are visited by millions looking for discount vouchers to download.

Voucher Background

The peak of the craze was in December 2006 when Thresher’s saw its ‘40% off all wine and champagne’ voucher downloaded and printed by millions of people and was so popular that it made the news. The following year they relaunched the offer.

Since then printable vouchers have exploded and been in constant supply from top high street retailers, in fact I’m holding a 30% one for Gap right now. If you head over to the discount section on Money Saving Expert you can literally download hundreds of different printable vouchers from restaurants to shopping.

At first the vouchers were either PDF or JPEGs that just circulated around via email. Many had a space to fill in your details such as name, age but you never had to fill them out to use them (or they just weren’t enforced properly). Often you don’t even have to hand the voucher to staff, simply display it.

Now it seems these companies have realised that they could be capturing the information of thousands of consumers. This means that store and restaurant websites are requesting some information before allowing to download vouchers such as name, age and email address, some are making it compulsory to sign up to newsletters or become website members. This allows the company to keep the customer updated on new offers, products and news.

A couple of things to note about these printed vouchers is that they almost always contain no unique numbers or barcodes. After asking a few stores about the process, they simply said that staff are told the length of the offer, the button to press on the cash register to apply the discount and to put the store receipt in a separate pile to be counted later. How old school is that process! We are talking about massive chains like Gap here. This is perfect for mobile.

So What About Mobile?

So lets look at the advantages at using mobile. The first and most obvious one to me is saving the environment.

Millions of these vouchers are being printed out just for the sake of being displayed at point of sale. Lets face it, that’s a massive waste of paper. I sometimes print the same voucher multiple times because I’ve lost it or left it at home when I’m at work.

I guarantee the first company to go mobile with these vouchers and angle them as better for the environment will immediately start the migration of these things to mobile….because what business wants to be seen as damaging the environment these days?

The next benefit is convenience. I’ve lost count the amount of times I’ve forgotten or misplaced a printed voucher when I’m out shopping. This results in me not going into that store because it feels like a waste of money paying full price knowing there is a voucher available. The store loses business and I don’t get my shopping. I would prefer to just show my phone screen than printing something out and remembering to take it.

The simple solution would be to use SMS for this. Text in to a shortcode to get a SMS voucher pinged back to your handset that you show at checkout. No unique codes, no barcodes, no special POS equipment or set up and no fuss, just like redeeming printed vouchers. You could even send the address and distance of the nearest store along with the voucher.

If data capture is required then information could be requested via SMS before the voucher is delivered. Another benefit is that future offers can be sent straight to the customers phone (with a opt-out of course), maybe even special discounts for mobile users to add incentive.

You could also use MMS using some nice graphics however you increase the risk of the user not having the settings or a compatible handset as well as a increase in messaging costs for the company.

WAP is the cheapest solution costing next to nothing, just simply host the voucher image, you can even create a sign up form before displaying.

Many vouchers are successful because they are passed on between friends and colleagues. Mobile is perfect for viral marketing and is far more actionable than a email or download.

There are some basic issues, one is cost. The price of allowing users to download vouchers and print them is zero, whereas sending a SMS would cost around £3200 for 100,000 messages. However apart from the SMS message costs it is actually a fairly simple and cheap to set up a ongoing campaign. Think about how quickly a company like Gap would make back the £8000 spent on allowing the whole of the UK to use SMS vouchers as simply as printed ones. Again, using WAP would make this cost next to zero.

Another issue is that many agencies and 3rd parties won’t suggest a simple text voucher like this because there is little profit margin. This is because all the money is in the licensing fees of 3rd party ‘patented solutions’, sadly that always involves some sort of download for the user before they can start redeeming vouchers which instantly cuts the actual amount of people that would use it. The 3rd parties need their software to add value into this scenario otherwise there is absolutely no need for them.

Lets remember you don’t need to download any apps to print a voucher online so why do it on mobile? I can understand you get better redemption tracking etc but at what cost? You lose a massive proportion of users plus spend more on licensing. Why try and run before you can walk? Lets just mimic what shoppers are doing right now with a piece of paper and use SMS instead.

These are the sort of trends brands and agencies should be jumping on to start introducing the behaviour of redeeming mobile coupons to consumers. Rather than expect consumers to download apps or get their heads around QR codes there is a opportunity to slowly teach mobile redemption to the masses. It really doesn’t need a complicated solution at this present time.

Once this marinates in consumers minds then you can start becoming more innovative using location, QR codes and apps like Cellfire.

Hopefully we will see ‘Click to print’ buttons for vouchers turn into ‘Send to mobile’ soon.

Smartphone users want m-coupons

Here’s something marketers don’t hear every day - there’s an audience out there ready and waiting for you to send them some marketing messages. According to new research by Compete, smartphone users want your m-coupons.

If you’re going to engage with smartphone users, send them coupons rather than a straight-forward SMS ad - that’s the message coming out of Compete’s recent survey.

When asked how interested they were in receiving various types of mobile advertising, the top five that smartphone users were most interested in receiving were grocery coupons (36%), scanable barcodes (29%), offers to save and pursue at leisure (26%), movie theater offers (26%) and location-based ads via SMS when going by a retailer with a promotion/coupon (21%).

Just 15% were interested in an ad via SMS.

“The fact that over 1 in 5 smartphone owners would be interested in these top-5 is very promising for the mobile marketing industry, considering that it is still in its early stages,” says Danielle Nohe on the Compete blog. “Brands need to focus on engaging and driving behavior of these ‘early adopters’ in order to help bring these concepts to mass market.”

Nearly three-quarters (74%) of respondents to Compete’s survey use their mobile devices primarily for personal, and not professional, reasons. Half said they use their smartphones at home for up to an hour each day, with 26% using them at home for one to three hours daily.

Over half keep themselves occupied in queues or waiting for appointments by using their smartphones and another 53% use them while shopping. Surprisingly, over half (53%) don’t use their smartphones during the daily commute.

Helen Leggatt

Coupons Coupons Coupons

Coupons can be a great way to promote, increase, and improve your business. They can be used to entice new customers, move hard-to-sell merchandise, “time-shift” your customers by getting them to come in during traditionally slow times, or as a stand-alone product when sold as gift certificates.

And, what could be simpler? Print a piece of paper and it’s done. Right?

Maybe.

Coupons can get much more complicated than you might think. What restrictions do you want to impose? Good on certain days? Certain hours? Is there a minimum purchase required? What about ‘rain-checks’ if the promoted merchandise is temporarily unavailable?

What about the structure of the offer? Buy-one-get-one-free? Percentage discount, flat
dollar-amount discount, or special one-time only price? Should the coupon expire?

Lots of questions, but how should you go about making all of these decisions?

Start at the beginning: before you do anything else, decide exactly what you want to accomplish with your offer. Do you want to increase sales, get new customers, introduce a new product or service, use the coupon as a product in and of itself (as in “gift certificate”), or ??? It is imperative that you make this determination first because all of the other coupon-related decisions depend on it.

When you finally do come up with the parameters of your offer, be sure that it is reasonable and easy to take advantage of. I remember seeing a restaurant coupon for $2 off the bill, but there were so many restrictions that I almost laughed out loud. You practically had to be an attorney to decipher the offer; it was good during certain hours on certain days of the week, for parties of 4 or more (adults only, kids don’t count), meals must meet certain
minimums, and so on. It was ludicrous. They apparently wanted to stimulate business, but I can’t imagine that ANYONE EVER took advantage of the offer. (It may be significant to note that the restaurant in question failed.)

If you are selling gift certificates, they cannot expire. Someone has given you money for a product or service that you have not yet delivered; to allow that to expire is unethical in my opinion, unless you return the money to the purchaser after the expiration date.

Accounting for them, however, can be a problem. A friend of mine received landscaping gift certificates for several years. She accumulated them until she had a big project to do, and the nursery that issued them was mortified that they were going to have to honor them all at once. If you think about it, though, they got a better deal because they had use of the money for all of that time, and the buying power of the money they received has diminished over time; a $100 certificate, for example, issued 5 years ago won’t buy as much today as it would have then. Gift certificates should be carried on your books as a liability. That way, you don’t realize the revenue or take the profit until the certificates are redeemed.

Some people have the feeling that gift certificates are too much trouble because of the liability and accounting, but my feeling is that you should do what’s best for your customer, not what’s best for you.

Coupons and gift certificates are good tools. Use them, but be smart about it.

Dave Balch Feb 2010

Nando’s cashes in on burger chain’s 2-for-1 promotion

Nando’s is hoping to cash in on disgruntled Victorian consumers who have been told they can’t redeem electronic versions of a 2-for-1 voucher for burger chain Grill’d.

Grill’d published a statement on its site saying it had been recently inundated with people trying to redeem a 2-for-1 burger offer that had been doing the rounds via email.

But because the offer had originated from the current print edition of Victoria University publication, Uni Times Magazine, Grill’d said the voucher was only available to readers of the print publication, and not available online.

The Grill’d statement said:

The Uni Times 2 for 1 offer was intended to be limited to the readership of the Uni Times publication – otherwise we wouldn’t have been able to offer it at all – All vouchers from the printed publication will be honoured. To get the real voucher just pickup a free copy of Uni Times from any of these locations. We hope all of our customers can appreciate the good faith in which the offer was released, and that neither Grill’d or its loyal customers will win in the long run if we allow digital copies or scans to be honoured for printed offers such as this. We know a lot of our loyal Grill’d fans have received electronic versions of the offer and we apologise for this, but we hope you understand that this was never our intention.”

Since the release of its statement it has attracted several comments from disgruntled customers on its site.

Nando’s quickly responded to the backlash, issuing a press release and posting its own statement on its sire today, telling consumers to bring their electronic Grill’d vouchers to their chain. In a press lrease entitled “Nando’s doesn’t care where your vouchers come from just come on in”, it said that consumers will be able to redeem Grill’d vouchers at any Nando’s restaurant in Victoria or Queensland.

Kim Russell, Nando’s Australia national marketing manager, said:

This time of year, students are back at uni, paying for all their books and struggling to make ends meet. Many of our own staff are uni students and so we understand their plight. Downloaded, photocopied, scanned, emailed, original, we don’t care where you got them, just bring the Grill’d vouchers into Nando’s and we’ll make sure you’re all well looked after.”

Nando’s is know for its topical marketing stunts, which have included hijacking the Bruno movie premiere and a radio as launched during Britney Spears’ Australian concert tour when she was criticised for lip-synching.

Nando’s ad agency is The Sphere Agency.

Grill’d was not available for comment at the time this article was published.

Mumbrella 25th Feb 2010

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