Could mobile coupons be a secret retail weapon?

coupn by HA! Designs - Artbyheather FlickrTraditional couponing is big business in the UK. According to figures from coupon experts Valassis, 257 million coupons worth £850m were redeemed in the first half of last year, and shoppers are currently saving an average of £5.70 a month using them.

They initiate intent, create a psychological contract with the brand, act as a reminder to buy, help to signpost the product in-store and obviously deliver a compelling incentive to purchase by reducing price. In fact, in our experience, they remain one of the single most effective tools in our arsenal to drive trial.

Yet paper couponing can be a messy business: there’s the up-front cost of distribution; they can only ever be as targeted as the media carrying them; they offer little in the way of campaign flexibility; they are almost impossible to trace effectively and they take an eon to actually get into the marketplace.

By contrast, mobile coupons are cheaper, can be created and sent in minutes, can be tailored to their audience’s lifestyle, personal preferences and geographic location, and are far more convenient for the shopper.

Plus, with Valassis recently announcing their new omni-channel redemption solution, Verso, promoters will be able to change coupon deals in real time, offering all manner of tactical opportunities for creative marketers.

As such, there’s a real desire from agencies like ours to start trialing mobile couponing as soon as possible.

That appetite exists amongst consumers too. According to vouchercodes.co.uk, 17% of us used a money saving voucher through our phone last year, and as far back as 2012 (a lifetime in technology terms) mobile vouchers already accounted for 61% of offline voucher redemptions.

There’s just one tiny problem.

The single biggest producer of FMCG coupons – the retailers – are the very behemoths holding up their widespread use in mobile. The EPOS system scanning constraints involved are huge, and the eye-watering amounts of money needed to overcome them.

The EPOS nut will surely be cracked at some point. But do we really need to wait?

The fact is, a mobile coupon redemption system already exists in over 32,000 convenience outlets where FMCG brands are stocked  - it’s called PayPoint.

In fact Co-operative Food stores are the single biggest user of the technology, having updated a great swathe of their tills in the last couple of years.

As Walkers showed with their ‘Gary’s Great Ingredient Hunt’ promotion, by using secure coupon distribution and redemption methods (like those offered by iMovo), brands can do more than just deliver discounts to shoppers, they can even distribute cash rewards and instant prizes.

I believe there is a real and present opportunity for challenger brands willing to test and learn in this space, to steal a march on the big boys, many of whom still lack mobile optimised websites.

And when the day comes (hopefully, not too far away) when mobile coupons reach a critical mass, they’ll have the first-party data to get the right offer, to the right people, at the right time.

Rachel McHale is an account director at Blue Chip