Unilever checks out digital coupons

Unilever checks out digital coupons
Jun 02, 2009 10:30am

SEEKING to marry a ubiquitous device with a time-tested marketing technique in a sour economy, Unilever has begun a trial run of a new technology that lets consumers redeem digital coupons by having a supermarket cashier scan their mobile phones.

The test, being conducted at a Shop Rite store in Hillsborough, New Jersey, includes discount offers for some of the Anglo-Dutch packaged goods company's most popular brands, including Breyers ice-cream, Dove soap, Hellmann's mayonnaise and Lipton tea.

Samplesaint, a Chicago mobile technology firm, developed the system.

"This has been a holy grail thing that people have been trying to figure out," says Marc Shaw, director of integrated marketing at Unilever, the first major marketer to test such a service in the US.

"I think this is on target for where consumers' heads are at right now."

To get the coupons, customers must visit the website Samplesaint.com, from which they can transmit the Unilever discount offers to an internet-enabled mobile phone.

At the checkout, the cashier scans the bar code on the phone's screen, redeeming the coupon and deleting it from the phone.

The test will run for four weeks, and Shaw says he hopes to see it extended to other stores after that.

Mobile coupons have been an area of growing interest for marketers, though the growth of overall spending on mobile advertising has been slowing down.

Research firm eMarketer expects US mobile ad spending to grow 17 per cent this year, less than half of last year's 35 per cent gain.

Putting marketing offers on a phone ties brands to a personal device that people tend to keep with them at all times, says Shaw.

"The cellphone is the thing that when you leave it behind at home, you go back and get it.

"It's the organiser of our lives."

Supermarkets, packed with hundreds of brand names vying for attention, are an important venue for coupon providers. In an April study, Icom, a division of Epsilon Data Management, said 87 per cent of survey respondents who had used coupons in the past month redeemed them at grocery stores, compared with 47 per cent at restaurants and 41 per cent at department stores.

Earlier in May, Randalls Food Markets, a unit of grocery giant Safeway, announced a coupon initiative with technology providers Cellfire and Shortcuts.com that links discount offers to customers' loyalty cards.

But technological hurdles remain. Many coupons offered on the web are printable but can't be transferred to a mobile device. And many cellphone-based coupons require the cashier to enter a code shown on screen.

Manual entry can slow down the checkout process, a big disadvantage in low-margin, high-volume retail businesses.

"We're still in an attempt-and-learn phase," in mobile couponing, says Andy Murray, chief executive of in-store-marketing agency Saatchi & Saatchi X, part of Publicis Groupe. Murray is sceptical that shoppers will load coupons on to their phones before making grocery runs, and he says finding, presenting and redeeming the coupons could prove to be a hassle for some. "Shoppers have a time budget, a money budget and a frustration budget," he says.

The potential for entry errors and other glitches has kept some big companies from trying the format, says Landy Ung, founder of 8coupons, which provides online coupons for the New York market.

Steven Boal, CEO of printable coupon site Coupons.com, says checkout with a mobile coupon is "fraught with peril", ranging from incompatible devices to software bugs to phones that get dropped.

In addition, many retail scanners can't penetrate a mobile phone screen to read the coupon.

Lawrence Griffith, CEO of Samplesaint, says his company's technology has solved most of those problems, and is expected to greatly reduce coupon fraud, since coupons will vanish from the mobile phone after redemption and can't be forwarded or emailed.

"We have full control," he says.

US consumers have been heavy users of coupons amid the recession, and online coupon providers have seen traffic and usage grow this year.

Boal says Coupons.com is developing a mobile platform it will launch in the third quarter, while 8coupons, currently focused on the New York market, will add Washington this summer, followed by Boston, Chicago and San Francisco in coming months, Ung says.

Because consumers can select the online coupon they want, the offers have far higher redemption rates than those in newspaper inserts and other ads.

Cellfire typically sees redemption rates in the mid-teen percentages, says CEO Brent Dusing.

Icom and others in the industry estimate the average redemption rate for traditional coupons is less than 1 per cent.

Unilever isn't abandoning traditional print coupons, or even other online partnerships, like one it has with Cellfire.

"It's just another way to do this," Shaw says.

"We want to be out there with as much variety as we can."

Wall Street Journal
Article from: The Australian