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Retail and Hospitality


Coupons are big business

LS Retail’s Carsten Wulff explains why both retailers and consumers love coupons

Until recently, coupons were seen as a unique feature of the US retail market. But over the last two years, the use of coupons has spread exponentially. Companies like Foursquare and Groupon have turned electronic coupons into a multi-billion dollar business. Acchart estimates that the electronic coupon business will reach US$9 billion in 2016 for the US market alone.

So what is the reason for this success? For the customer, the answer is clear. A promotion or a special offer is available to everyone, whereas a coupon is only available to individuals. This makes coupons almost feel like free money for the consumer – and needless to say free money is very popular! Soon, this free money will be available to use on credit cards, with the likes of Groupon and Living Social exploring the possibilities.

For years, LS Retail has offered the ability to support retailers that want to offer coupons to their customers worldwide. In the LS Retail solution, the retailers use three types of coupons: Store Coupons, Return Coupons and Manufacturer Coupons. Coupons are a cheap and efficient way of marketing a store. For example, a simple setup makes it possible for the individual stores to print out return coupons for the customers.

Furthermore, customers who are registered in LS Retail Member Management can receive personalised coupons based on categories or personal preferences. This makes couponing a very effective tool for targeted marketing.

LS Retail comes with coupons, promotions and membership management support as standard. The LS Retail coupon management solution was developed with one purpose in mind:

  • To increase profitability
  • Make customers spend more to save a little
  • Increase the number of new customers
  • Potentially sell more expensive brands
  • Increase the sales of high-profit or seasonal items
  • Increase loyalty by rewarding existing customers
  • Activate former or dormant customers
  • Increase brand awareness in cooperation with manufacturers.

Around 50 per cent of retailers in the US are currently using coupons in one way or another. Those retailers that are not using coupons are missing out on a huge opportunity to boost traffic in their stores.

Carsten Wulff is partner management director at LS Retail. This article is taken from his blog post on the LS Retail site

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