Digital coupons: the new sales tool [Strategy]
0 Comments | Times of India, The, Sep 2, 2010
KOLKATA: Bargain hunters in Indian cities are flaunting a new tool: digital coupons. Digital copycats of the same old coupons that you used to cut out from paper and produce at retail outlets to avail special discounts are getting popular among marketers looking to cash in on rising use of mobile and internet in the country.
The market for coupons is estimated at close to Rs 25 crore and is expected to rocket in the short-term with many brands and retailers including Adidas and Spencer’s offering mobile and internet coupons and more such as Tatas’ Infiniti Retail and United Spirits expected to follow.
“Coupons have the potential to grow to a $1-billion market in India in 10 years,” says Kunal Bahl, CEO of Jasper Infotech, a marketing company specialising in multi-channel direct marketing solutions, which has done coupons for Baskin Robbins, Subway and Nirula’s.
Digital coupons are usually mailed or text-messaged to select set of customers – be it members of a royalty scheme, or regular shoppers at an outlet, or registered users of a coupon enterprise. One can get the deal by displaying the message or a printout of the coupon at the particular outlet.
While marketers distribute coupons on their own also, more often they do it through coupon enterprises such as Jasper that provide technology platform for these offers.
There are tens of internet coupon (e-coupon ) service providers in India, mostly covering the top cities in the country . Jasper owns e-coupon sites SnapDeal, which has 60,000-plus fans on Facebook, and Grabbon as well as mobile coupon (m-coupon ) service MoneySaver. Other popular ecoupon platforms include Coupon Seva and Upto75.com.
They can be pretty assured of good days ahead. The reason is digital coupons are most popular among young people in the age group of 18-35. It is the same people who drive consumption in one of the youngest countries. Add to it the growth in economy, upbeat consumer sentiment and the rising number of mobile subscribers that crossed 630 million in July.
Mobile and online coupons in India started gaining steam 6-9 months back. Some popular offers include a 50% off at Subway , 15% discount on Adidas, buy one-get one free on Baskin Robbins through a mobile coupon and 20% discount on apparel on a minimum purchase of Rs 999 at Spencer’s Retail.
Spencer’s took pilots for mobile coupons in Bangalore and Kolkata, which led to close to 20% redemption rates. The RPG group firm is pushing newer offers in apparel and the home segment through such coupons. “Mobile coupons are also cost-effective compared to print media,” says a Spencer’s Retail spokesperson.
While discretionary spending categories like dining, personal care and recreational activities see the maximum usage of such coupons, others like apparel, electronics and liquor are warming up to the idea.
Infiniti Retail, the Tata Group’s electronics retail arm that runs 52 Croma stores, is also evaluating mobile and internet coupons. “Consumers can be loyal to a brand but not to a retailer . Here, digital coupons can make a lot of difference,” says Ajit Joshi, CEO & MD of Infiniti Retail. The company is concerned about the privacy issue though
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