Friday, January 27, 2012

Challenges and Opportunities for Coupon Companies

Challenges and Opportunities for Coupon Companies

Growing Role:  Coupon companies are rapidly becoming a key player in the consumers’ decisions about what to buy, where to buy it and how much to pay for it. Coupon companies have gained market acceptance in an amazingly quick time and are present in an increasingly varied spectrum of consumer services, and most recently, goods as well.

Coupon company challenges: with this success has also come a number of growing challenges, driven mainly from the fact that currently the sole value proposition of the coupon is to provide a discount on the purchase of goods and services:

1)      Consumer Loyalty: How to differentiate amongst the outpouring of coupon offerings when the offering is relatively easy to duplicate and there is no evidence of any enduring customer loyalty.

2)      Merchant Loyalty: how to ensure repeat business with merchants who show similar lack of ongoing loyalty to any particular coupon company  – especially since THEIR customers show no hesitancy to switch coupons they use for a particular purchase decision.

3)      Expansion into Products: consumer purchase behavior for products is significantly different from those exhibited for services. Consumers place significantly greater value upon the availability of information to help them decide on the products that best fit their needs.

Coupon Company Opportunities: In this rapidly changing environment coupon companies also enjoy opportunities to significantly accelerate profitable growth:

1)      New revenue sources: develop services and value adding opportunities outside of the increasingly non-differentiated world of pure discount coupons.

2)      Differentiation: gain customer loyalty, “stickiness” and larger share of customer wallet, by providing these customers with competitively superior services that satisfy their related business and personal needs.

3)      Targeted High Value Customers: replace the current “shotgun” approach to sales and marketing with one that takes advantage of the opportunity to focus and cultivate consumers and merchants based on the best fit with the coupon company’s core focus and capabilities.

In the future article we will discuss how coupon companies can take advantage of these fleeting opportunities and, at the same time, provide significant value to their consumers and merchant partners.

For more details on solving coupon companies' challenges and taking advantage of opportunities contact applez2applez by e-mail at or follow us on Twitter at