Coupon redemption declined by 6.4% in the first six months of 2017, as compared to the year-ago period, but the number of coupons redeemed still exceeded one billion between January and July, according to a study by Inmar.
Load-to-Card offers in the first half of 2017 increased 51.6% compared to last year (though they only make up about 0.5% of all coupons distributed), bringing up the redemption volume for these offers as well, which increased by 36.1% from the year-ago period. Free-Stand Inserts were still the most popular form of coupons for both distribution and redemption, accounting for 89.8% of all coupons distributed and 34.2% of all coupons redeemed, the study found.
Coupons have a significant impact on shopper behavior as well, with 72% of coupons used in 2016 affecting shopper behavior — usually by encouraging a customer to buy a particular item or to buy more of a given product. Inmar also found that of the 69% of consumers who make shopping lists before visiting a store, 41% use coupons to do so.
Marketers are constantly striving to find new ways to connect to consumers and create brand loyalty — and this study suggests coupons might still be the way to do it.
Coupons can seriously impact a consumer’s decision to shop at a particular retailer, especially when they become a core part of a brand’s identity, as with Bed Bath & Beyond’s blue coupons, which actually hurt the retailer’s margins, but which have come to be expected by consumers. Even as the company discussed store closures in June, CEO Steven Temares indicated that blue coupons would continue to be a part of the brand’s strategy.
"We've simplified the navigation of our site, now introducing a new mover tab to make it easier for these customers to find relevant content and products. In addition, we've also launched a simple coupon code in checkout to allow customers to apply their favorite big blue coupon to their online order," Temares told analysts in June.
When it gets down to it, though, Temares and other retailers who rely on coupons, like Walgreens, are onto something. According to Inmar’s report, 65% of shoppers said they would try a new product if they had a coupon for it and 58% would abandon their regular brand for a different one if the other brand offered a coupon. With a customer base that easily swayed by coupons, it’s no wonder that Bed Bath & Beyond is hanging on to its blue coupons.
Still, the choice to continue with discount and loyalty programs is a difficult one, as programs can come to an end for any number of reasons. Notably, Target recently killed its popular Cartwheel perks program and is in the process of merging Cartwheel into its main Target mobile app. Coupons might be successful at drawing in consumers, but they do carry risks for a company’s profit margins, as well as raising the bar for customers who come to expect heavy discounts whenever they shop.