Will The Smartphone Bridge the Gap for Convenience Store Couponing

​To say that the business of couponing is big is an understatement. According to the Association of Coupon Professionals, $3.39 billion in coupons were redeemed or three billion individual redemptions of the total 310 billion coupons issued.

So how many coupons did your stores take in last year? If you said, “not many,” then you’re not alone. The majority — nearly 90% — of coupons are paper based and distributed by freestanding inserts (FSI) in newspapers and magazines, and the overwhelming majority of the redemptions take place in the grocery or chain drug channels.

So why doesn’t our industry attract these valuable sales drivers? Why don’t we target the many customers who regularly use coupons? The answer lies both in consumer psychology as well as limitations in enabling technologies.

Consumers are far less willing to use convenience store coupons than at a grocery store, and I think it is safe to say that consumers do not generally think of convenience stores as having low prices, so value seekers do not do an inordinate amount of shopping with us.

Not surprisingly, the number-one reason a customer shops at a convenience store is, in fact, convenience. This brings up the second consumer hurdle: When you are in a hurry and looking to get in and out of a store quickly, how likely are you to want to hassle with paper coupons?

As if these challenges weren’t enough, consumer packaged goods (CPG) companies do not often develop deals with the convenience store shopper in mind. Part of the reason is our industry’s historical lack of coupon enabling technologies. Couponing is an industry with its fair share of waste, fraud and abuse, and our industry represents a higher than normal amount of risk for CPGs.

For example, in the grocery and chain drug channels, the majority of the point-of-sale (POS) systems are equipped to properly process coupons per the coupon issuer’s rules — a capability virtually non-existent in our channel. In our stores, more than likely the cashier would have to manually run a presented coupon and physically read the coupon and make all the proper decisions of acceptance, such as expiration date, qualifying products being purchased, etc. This leaves room for inaccuracies, which understandably are not something the issuing CPG companies are thrilled about. So to some extent, technology has been holding us back. Yet ironically, it may be technology that allows us greater participation in the future.  more