This week in my Mobile Advertising and Design course, we are studying digital coupons.

This assignment is based on an article dated November 11, 2009, titled,  “Coupon Clippers Drive Incremental Sales”.

The article cites that digital couponing is on the rise and 1 out of 3 consumers report using more coupons than at the same time a year before, and that males age 18 to 34 were doing more comparison shopping and actively searching for coupons.  Further, as much as 59% of consumers will forsake name brands for generic brands based on price.

The next question raised by the article is whether the coupons drive incremental sales or cannibalize existing sales.  The study found that coupons do, indeed, drive incremental sales by as much as 40% and those customers are either new or lapsed buyers.  The study also cites that 63% of the redemptions drove incremental volume and did not cannibalize existing sales.

Our instructor then posed the question:

Does “digital couponing” cause consumers to forsake brand name products over cheaper products or services?

To that question I would have to say no.  I believe that digital coupons help drive the sales of name brands over generics when the coupon brings the price inline with the price range of the generic.  If I am shopping and I prefer the name brand product, but buy the generic to save money, I will use a coupon and purchase the name brand.  For example, the price difference is 50 cents and the name brand gives a coupon for 35 cents, I will choose the name brand.  That confirms the findings of the study, as I would have been considered a “lapsed” buyer.

There are some items I simply will not buy generic replacements for.  Instead I will shop the ads and when there is a really good sale, I will pick up a couple of the same item, saving me money in the long run.  A good example of this is Heintz Ketchup.  I grew up on it, it’s the only kind I like, and yes it’s more expensive but I will not buy any other brand – it’s the taste and the consistency.  Now, if I get my hands on a coupon, it’s a happy day, and just like the others cited in the article, I will look for a coupon.  I am not loyal to Heintz per se, I will buy generic brand relish, mustard and other products that Heintz sells in order to save money, but I will not scrimp on my ketchup!  This sale would have been categorized as a “cannibalized” sale.

I really do not think Consumer behavior can be so easily categorized in those terms.  We live in interesting times right now.  Things have changed drastically with the steep recession we are in, and everyone is doing the best they can to get by.  What I find interesting was stores like Publix who would run their ad specials in conjunction with manufacturer’s coupons so if they were selling something 2/$4 this week, you could also use a manufacturer coupon to bring the price even lower.  I am sure that is why Publix is gaining market share and increasing revenues.

Digital Coupons vs. Newspaper Coupons:

Another article titled “Gens X/Y, Rich Households Hike Private-Label Sales, written May 6, 2010, affirms my shopping habits since the recession.  In this article it cites a Nielsen report that National brands still drive the vast majority of sales (82.7%) as well as units (78.1%).  During the period of time of the study, store brand sales grew by 2.5%, while National Brands were able to stabilize declines and achieve a growth of 0.4%, due to increased promotional spending.  The study showed that categories with the strongest brand marketing support (Beer, Candy) or those achieving the biggest innovations (deodorants, detergents) were the strongest of the national brand sales.

According to a Research Brief titled “Digital Coupon Redemption Value Beats Newspapers”, dated March 1, 2010, use of digital coupons outpaced newspaper coupons 10 to 1.

This study also cites a Nielsen Online Metrics report stating that coupons/rewards was the fifth fastest growing Internet category in 2008.  Google reported that searches for the terms “printable coupons” and “online printable coupons” grew 186% and 178% respectively during the year.  Yahoo reported searches for “coupons” were #1 on their list of economy-related search queries during the same period.  Futher, the 2009 Savings Index found that Atlanta residents were heavy users of Coupons.com offers in 2009, followed by Tampa, Cincinnati, St. Louis and Minneapolis.

Digital Coupons expected to continue growth in 2010:

In conclusion, I agree with Coupons.com CEO Steven Boal when he said “we expect the adoption of digital coupons will continue to accelerate in 2010”.  We are far from being “in the clear” with respect to this economic situation.  Smart manufacturers will continue to use digital coupons to invite consumers to save on their products.  Digital wins hands down – they are easy to locate, easy to print and while the coupons from yesterday’s newspaper are still sitting on your coffee table at home, the ditigal ones can be retrieved right before you leave work to purchase dinner on the way home!

Sources:

http://www.mediapost.com/publications/?fa=Articles.showArticle&art_aid=117207

http://www.mediapost.com/publications/?fa=Articles.showArticle&art_aid=127527

http://www.mediapost.com/publications/?fa=Articles.showArticle&art_aid=123365

http://promomagazine.com/incentives/news/0224-digital-coupons-beat-newspapers

Google’s new Street View Snowmobile!

Just in time for the 2010 Olympics, Google announces their Street View Snowmobile.  I love this idea!  So many years I’ve wished for a more “community-centric” view of the Olympics – more visuals of the snowy peaks and the villages.

This year, we will be able to become even more immersed in the Winter Olympics than in years past!  All the thanks goes to Google’s newest addition to Street View – the Snowmobile!

This is such a great idea, it makes me wonder if they are working to retrofit a BOB with video equipment for the Summer Olympics!

That, too, would be a new perspective!

The BOB - a personal submarine!

Economic hardship has impacted every facet of life – and that is also true for law firms (yes, I know you find that hard to believe, but they are experiencing layoffs as well).  One law firm has stepped up, listened to their clients, and answered a need clients were complaining about.

I read an impressive story that will be published in the Tampa Bay Business Journal’s latest edition. Foley and Lardner, LLP, raised the bar in client satisfaction, and erased the biggest fear of anyone who is thinking of hiring a lawyer.

That fear is about receiving a bill for more than they expected in legal fees.

Its a universal problem – people don’t hire lawyers even when they should, because they do not believe they can afford to.  It’s not just the initial retainer, it’s the fear that once the attorney is retained for a matter, the bill becomes an unknown quantity – a day to day worry that they may have a second legal issue to deal with when they can’t afford to pay their lawyer.

Foley and Lardner, LLP get an A+ in client care, because they LISTENED to their clients, and answered their concern.

In fact, they may create a World Wide Rave as defined by David Meerman Scott in his book of that title.  They gave up control to the client – Rule 3 of the Rave!!   When it comes to billing and budgeting of legal matters, they have successfully taken away the fear of  that big ulgy surprise when their clients open the envelope containing their legal bill every month.

In response to client concerns (this is a concern of ANYONE who hires a lawer for ANY legal matter),  they developed a proprietary software system, part of which allows clients of all 1000 of the lawyers in the firm to interactively share real-time billing information and keep their legal matter on a budget.  Clients can go online anytime and see trending in the billable hours by their lawyer,  and make contact to discuss options for their case BEFORE they go over budget and have yet another legal matter to deal with.

The full story was reported in the Wall Street Journal on Jan 5, 2010.

To be honest, this system does more than just allow the client to manage their legal bills and budget, and that is why it cost $1 Million to put in place.  However, this is a true investment in the firm.  It serves as a management tool, as a client communication tool and as a marketing tool to attract new business!

Smaller firms will say they can’t afford $1Million investment to do the same thing.  They don’t have to.  Small firms can do the same thing, very easily, using much simpler tools.  The real question has always been:  will they come out from behind the curtain on fees and allow the client control?  Will they allow the client to speak honestly and hold them to a budget the client can afford?  If they are smart, they surely will do that – and reap the rewards of (a) honest communications with their clients; and (b) growth of their law practices.

The bar has been raised – let’s see if a precedent in billing practices has now been set,  and which lawyers and law firms creatively  rise to the occasion!

On February 12, 2009, more than five hundred students came together at Full Sail University in an attempt to create a Guinness World Record.

Imagine the power this group could bring to solving a problem like hunger, rescue efforts in Haiti….Never doubt that a small group of thoughtful committed citizens CAN CHANGE THE WORLD.  Indeed, it’s the only thing that ever has!  [Margaret Mead 1901-1978]