Use of Digital Grocery Coupons Rises 141% [Report]

When con­sumers have decid­ed what they want to buy they often look for coupons or vouch­ers. Com­pa­nies that offer a coupons either direct­ly or via their affil­i­ates can often end up win­ning the sale. This post looks at how dig­i­tal vouch­ers are cross­ing the...

Pat Hong By Pat Hong from Linkdex. Join the discussion » 1 comment

When con­sumers have decid­ed what they want to buy they often look for coupons or vouch­ers. Com­pa­nies that offer a coupons either direct­ly or via their affil­i­ates can often end up win­ning the sale. This post looks at how dig­i­tal vouch­ers are cross­ing the online/offline divide for the most every­day of pur­chas­es: gro­ceries.

A new L2 study high­lights an oppor­tu­ni­ty in the gro­ceries mar­ket around dig­i­tal coupons. Present­ly, dig­i­tal e‑commerce rep­re­sents just 3.3 per­cent of gro­cery, yet ana­lysts expect that share to rise to between 6.7 and 16.9 per­cent with­in the next decade.

Con­sumers today are con­duct­ing online research, and mak­ing the most of dig­i­tal pro­mo­tions to sup­port their reg­u­lar gro­cery shop­ping trips. As stat­ed in the report “dig­i­tal mar­ket­ing is already mak­ing an impact in the shop­ping aisles as shop­pers look for coupons online before and dur­ing their trip to the store[s]”.

The change in behav­ior has prompt­ed a rise in dig­i­tal brand pro­mo­tions with dig­i­tal coupons expe­ri­enc­ing a surge in pop­u­lar­i­ty.

The Rise of Digital Coupons

Accord­ing to L2 Insight’s Dig­i­tal Coupon Report:

  • In 2013, dig­i­tal coupon redemp­tions topped 66 mil­lion, up 141 per­cent year on year.
  • In addi­tion, dig­i­tal coupons aver­age redemp­tion rates of 14 per­cent, out­pac­ing print coupons that tal­ly rates of just 1 per­cent.
  • In store, 90 per­cent of smart­phone shop­pers use their device in aisle, search­ing for recipes (37 per­cent), look­ing for coupons (24 per­cent), and research­ing nutri­tion­al infor­ma­tion (19 per­cent).

The val­ue of dig­i­tal coupon incen­tives to a reg­u­lar gro­cery shop has a great deal of val­ue in the con­text of new con­sumer pur­chase jour­neys. As stat­ed in the report, “recent sur­veys sug­gest mobile shop­pers spend upward of 15 hours a week research­ing prod­ucts or ser­vices on their smart­phones and are 4.8 times more like­ly to con­vert in-store than on their phones.”

Majority of Brands Still Underutilize Digital Coupons

How­ev­er, the major­i­ty of brands, and many of those who have been oper­at­ing in the gro­ceries mar­ket for sev­er­al decades, have yet to adjust their pro­grams and incen­tives with the grow­ing pop­u­lar­i­ty of dig­i­tal coupons. As the chart below illus­trates, most brands are still lack­ing in their dig­i­tal coupon dis­tri­b­u­tion. With the excep­tion of the case of Ama­zon, a major­i­ty of brands still aren’t pro­vid­ing coupons for use in lead­ing gro­cery out­lets such as Wal­mart and Tar­get.

Accord­ing to L2 Insight’s Dig­i­tal Coupon Report:

  • While 36 per­cent of brands have coupon sec­tions on their brand sites, only 24 per­cent were offer­ing coupons dur­ing the research data col­lec­tion time peri­od.
  • While e‑grocery play­ers Ama­zon and FreshDi­rect have ful­ly inte­grat­ed coupons into the online shop­ping process, the major­i­ty of brands rely on the con­sumer to print coupons at home for in-store redemp­tion.
  • Only 24 per­cent of Food brands had coupons avail­able on their brand sites dur­ing our data col­lec­tion peri­od, even though 36 per­cent had a ded­i­cat­ed coupon sec­tion in the main site nav­i­ga­tion.
  • Even when dig­i­tal coupons were avail­able, they were for print­ing and in-store redemp­tion, and brands failed to cap­i­tal­ize on social or email shar­ing. Just nine request­ed cus­tomer data in exchange for coupon access.
  • Although 74 per­cent of female shop­pers report obtain­ing coupons from email pro­mo­tions, just 5 per­cent of brand­ed Food emails high­light­ed coupons.

Demand for Mobile Apps

L2 Insight’s Dig­i­tal Coupon report reveals that brands and e‑commerce gro­cery play­ers are under­serv­ing cus­tomer demands for dig­i­tal coupons. It has left a gap for coupon-ded­i­cat­ed mobile aggre­ga­tors and apps such as Coupon Queen, Gro­cery iQ, Cell­fire, and Shop­kick, which have stepped in to fill the void. Of a sam­ple sur­vey, 17 per­cent of con­sumers report­ed using a mobile app to man­age dig­i­tal offers.

Often over­looked as a mar­ket­ing strat­e­gy, the report presents com­pelling evi­dence that there is a great deal of demand for dig­i­tal coupons, and the chal­lenge for brands and e‑commerce com­pa­nies will be to pro­vide a stream­lined mobile, and user expe­ri­ence for con­sumers look­ing to take advan­tage of dig­i­tal offers and pro­mo­tions.

You can down­load L2 Insight’s full Dig­i­tal Coupon report here.

How is your busi­ness opti­miz­ing for the con­sumer look­ing for deals, coupons, vouch­ers, or codes before they buy? Let us know in the com­ments below.

Pat Hong

Written by Pat Hong

Editor at Linkdex/Inked, Linkdex

Pat covers the SEO industry, digital marketing trends, and anything and everything around Linkdex. He also authors Linkdex's data analysis and reports, analysing the state of search in various industries.

Inked is published by Linkdex, the SEO platform of choice for professional marketers.

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