Now that coupons have gone digital, it’s hip to be frugal, executive says
There may soon come a time when clipping coupons out of the Sunday circular is a distant memory. The problem with coupons has always been the hassle. You have to happen to find a coupon you want and then clip and save it.
Indeed, coupon use was declining until 2008, when the recession hit hardest. In the following years manufacturers pushed out a record number of coupons to retain market share. Last year, 332 billion coupons were offered. Use of digital coupons - taken from websites and mobile devices - is increasing. They represent about 10 percent of all coupons redeemed. A key advantage is that consumers can proactively search for bargains.
A major player is Coupons.com, formed in 1998. It offers coupons on its own website, those of newspapers, and hundreds of retailers. Chief executive Steven Boal discussed the business.
■ What kinds of trends are you seeing?
Uncertain economic times . . . raise people’s awareness of their pocketbook, and they think about their spending. We’re now seeing a massive resurgence in the use of coupons. The ironic thing was that we were growing steadily as a business going into the recession, but what we’ve found now is we have a new set of users and a learned behavior. The economic uncertainty hit and we had a rush of additional consumers use the website. What we’re being told and the behavior that we’re observing is that this is very much a sustained behavior. It is now hip to be frugal. You don’t just see it at Coupons.com, but you’re seeing it in grocery stores, you’re seeing it in magazines and on TV.
■ How has this rediscovery of coupons and gravitation toward the Net changed the business?
For decades, the coupon industry persisted on delivery through the Sunday newspaper. Today, Sunday subscription levels are back to where they were in the 1940s, but the population has exploded since then. The industry like any other has had to adapt. The evolution . . . has been from a newspaper delivery system to a digital and online system.
It’s an interesting phenomenon that we now power the coupon sections of over 500 newspapers online. It’s not that Sunday news is going away, it’s the physical paper that’s at risk. People are actually ingesting more news now than they ever did before.
■ Investors pumped $200 million into your business. What was the main goal?
We are being rushed by consumers and product manufacturers with demand to issue more coupons, reach more consumers, and deliver more goods and services than ever before. We’re using half of the proceeds of our fund-raising, about $100 million, just to grow to satisfy the demand.
■ You started a savings club which requires a membership fee. What’s the strategy?
Today if you were to visit Coupons.com . . . you’d see about 170 coupons or so, depending on your ZIP code. If you were a savings club member, you’d see 190. The cost is $3 a month or $30 for a year, which gives consumers access to a lot of savings.
David Pitt writes for the Associated Press.