Are Coupons the Key to Mobile Marketing?

Mobile commerce has exploded in recent years—and mobile coupons are responsible for much of this growth. In fact, mobile coupons are redeemed 10 times more than print coupons and the number of mobile coupon users is expected to reach 53.2 million by 2014. Combine that with the increase in mobile usage by consumers on the go, and it’s clear that mobile coupons are the perfect solution for growing your small business and attracting customers on the hunt for discounts through their mobile devices.

Mobile commerce has exploded in recent years—and mobile coupons are responsible for much of this growth. In fact, mobile coupons are redeemed 10 times more than print coupons and the number of mobile coupon users is expected to reach 53.2 million by 2014. Combine that with the increase in mobile usage by consumers on the go, and it’s clear that mobile coupons are the perfect solution for growing your small business and attracting customers on the hunt for discounts through their mobile devices.

The Mobile Marketing Opportunity Is Real
eMarketer estimates that nearly 20 million US adults will redeem a mobile coupon this year, including coupons or codes received via SMS, applications and mobile web browsers; quick response codes for redemption online or offline; and group buying coupons purchased via mobile. More than 70 percent of US adult digital coupon users will redeem a coupon or code on a mobile device for online or offline shopping in 2014.

The mobile coupon audience will post double-digit growth rates annually through 2016, driven by continued smartphone and tablet adoption and the proliferation of digital channels offering coupons easily accessed by mobile, such as mobile apps, daily deal and group buying sites, email, and social networks. eMarketer expects that by 2016, mobile coupon users will represent nearly 83 percent of all digital coupon users. This is huge!

The Revenue Opportunity
There are a number of different ways to engage consumers and drive revenue opportunities, including:

  • Coupons: Mobile coupon redemptions in the U.S. will exceed 53 million this year. The mobile coupon audience will post double-digit growth rates annually through 2016, driven by continued smartphone and tablet adoption. (Source: Business Insider 2014)
  • Geo-Targeting: Geo-targeting has boosted the success of SMS-delivered coupons, with retailers seeing high redemption rates from coupons sent to consumers close to their stores.
  • Loyalty Programs: Consumers expect to be rewarded for brand loyalty, particularly millennials. A 2014 poll by Bond Brand Loyalty indicates that 6 in 10 millennial respondents would switch from brands they buy and two-thirds would change when and where they shop, if it meant getting a better loyalty program.

Don’t Forget the Tablet
Year after year, tablets are becoming an increasingly important part of a brands mobile strategy. According to eMarketer, in 2014, 80.2 percent of mobile coupon users will use a tablet for redemption, compared with 75.4 percent who will do so on a smartphone. Tablets are frequently used for in-home digital purchases, which boost tablet coupon redemption.

Coupons, geo-targeting, and loyalty programs can be offered, tracked, and monetized with a mobile engagement platform. Additional revenue opportunities include banner ads, mobile video, rich media and SMS campaigns. But keep in mind that more friction points in the redemption process will greatly reduce the use of mobile based offers. So keep it simple for consumers to redeem your offers.

The data from Black Friday on-line shopping as well as coupon redemption data from Cyber Monday should tell an interesting story for retailers who have made a strong commitment to mobile couponing to drive commerce and increase total purchases by incentivizing their consumers.

Author: Greg Hoy

Mobile is going to continue to grow as will its use as a way for brands to interact with their customers. However, the mobile device is far more personal than your email inbox. Fortunately, there are ways to implement a mobile marketing strategy that delivers relevant information that your customers want to receive. By understanding how your customers want to engage with you will help you build loyalty and in turn, help you see faster returns on your marketing investment.

Greg is a 12-year mobile industry veteran and vice president of mobile solutions at Hipcricket, Inc., where he's responsible for the vision and strategy to deliver consumer experiences that increase mobile engagement and lifetime value across mobile messaging and advertising, mobile websites, social media and branded apps

2 thoughts on “Are Coupons the Key to Mobile Marketing?”

  1. Greg – great post. We present supporting arguments and addit’l evidence in a recent whitepaper – “How Retailers and Brands Can Win with Digital Offers and Attribution at Point-of-Sale.” In it we discuss the importance of targeting, channels (esp. mobile), and offers (features, testing and optimization), as well as attribution (so that brands and retailers can determine what is working and what isn’t). Most importantly, we emphasize using offers to drive value (rather than merely discounting), delivering valued offers to customers, and boosting key metrics (esp. basket size and LTV). Believe you’ll find it interesting… you can download a copy (free) at this link: http://immr.org/digital-offers-and-attribution.html
    Phil Hendrix, PhD – immr and Gigaom Research

  2. Information is valid but you don’t explain how mobile coupons are redeemed at checkout. Can regular scanners read a phone with a UPC code or does the retailer need to have optical scanners? If so, very few retailers have optical scanners, can you share insights into the fulfillment of mobile coupons?

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