Mobile coupon use rises among consumers

September 30, 2013

Businesses have long used coupons to help them sell products and drive traffic into stores.

Businesses have long used coupons to help them sell products and drive traffic into stores. There may still be a large untapped market of consumers who want to use coupons, however – shoppers connected to their mobile devices.

Smartphone coupons are becoming mainstream, driving both dollars and new consumers to brick-and-mortar retailers, according to a report from Business Insider. However, less than one percent of all consumer packaged goods coupons distributed in the United States during 2012 were digital, suggesting that many companies are failing to grasp the possibilities offered by distributing promotions through mobile devices.

As more consumers shop on smartphones via mobile credit card processing terminals, the use of mobile coupons is rising dramatically. The news source reported that more than 29 million U.S. shoppers used mobile coupons from their smartphones at point of sale terminals last year. That’s more than three times the total of smartphone users who redeemed mobile coupons during 2010. Further, it’s expected that more than 47 million consumers will employ the use of mobile coupons at some point during 2014.

Coupon users are swapping out their printable coupons for online and mobile alternatives. More than 90 percent of consumers polled in a recent RetailMeNot report explained they used coupons. While 60 percent of shoppers still made use of printed coupons, the amount of consumers using online coupons had nearly doubled – up to 29 percent, from 16 percent in 2010. Additionally, roughly 10 percent of respondents had made use of mobile coupons, when less than 5 percent had done so in 2010. 

Promotion often driven by social media
The distribution of coupons may currently be driven by businesses increasing focus on their consumers use of social media on mobile devices. For example, more than half of Twitter’s ad revenue this year will come from ads placed on smartphones and tablets, according to an eMarketer report cited by Bloomberg. As shoppers spend more time on their mobile devices, businesses may need to promote through smartphones in order to drive consumers to credit card terminals. Twitter’s sales have grown at fast rates, with global ad revenue seeing an increase of more than double this year.

“Mobile is clearly for Twitter the critical piece,” Justin Merickel, senior director of advertising solutions at Adobe Systems, told Bloomberg. “You’ve seen them really take, I think, a forward view into how to work with advertisers in that arena. We’re excited about both the growth and the potential that we’ve seen in that business.”

Facebook is also beginning to earn more revenue through advertisements placed on smartphones and tablets. Mark Zuckerberg, chief executive officer, said mobile ads made up 30 percent of the company’s revenue in the first quarter but will soon make up more than half of all advertising dollars earned, Bloomberg reported.

Coupon use varies across sectors
Businesses in select industries are experiencing great success with the use of mobile coupons. More than 40 percent of shoppers who had redeemed a coupon through their phone did so at a grocery store or department store, according to Business Insider. Additionally, 39 percent of consumers had used such a coupon at a clothing store, and 29 percent had used one at an electronics store, indicating that retailers in these fields could benefit greatly from offering smartphone-based discounts.

It’s nothing new for businesses to lure in customers with the use of promotional payment methods like coupons or gift cards. By offering these products through smartphone applications or in conjunction with mobile credit card payment processing, companies may be able to attract a new selection of customers.

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