Printed Coupons: Days are Numbered

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Coupons are back in vogue as people are looking for ways to save money even though most people don't burst with pride when they use coupons.

I've always struggled with coupons because I never have them when I decide to go to the store - usually on the way home from work. Even if I remember to take them with me, it's a pain organizing them so it is efficient to find these products.

Coupons are not only inefficient for consumers, the redemption process is ridiculous. I never realized the distance a coupon travels whenever a consumer uses it. Retailers send coupons periodically (i.e. weekly) to one of a couple US based clearing houses who process coupons and reimbursement retailers.

Coupons are then sent to Mexico where they are scanned and then shredded. I don't know the processing cost for these coupons, but it doesn't take a rocket scientist to figure out that this process is expensive.

I assume newspapers have a blind eye to alternative solutions just as they did with classifieds. Newspapers repeatedly blame Craig's list for their demise when it was their own fault. Traditional companies almost always attempt to monetize digital content (Craig's list is digital content) the same way they monetized using print. I predict the same thing will happen with coupons. Newspapers will once again miss the boat. Innovators Dilemma describes why establish companies struggle with disruptive technology.

Newspapers may not feel threatened (if you are in the newspaper business, I would like to hear your perspective) because online coupons have their own short comings. I don't understand why people print out online coupons valued at $0.75 or $1. The cost to print the coupon is almost as much as the value of the coupon. You have the same problem as the coupons in the newspaper - forgetting to bring them when you go to the store. There is also the issue the 30 - 40 minutes needed to print coupons - wait for your computer to boot up, get to the coupon web site, and then print the coupon - that's another topic.

Grocery stores are experimenting with another idea. Club cards are now allowing you to "attach" coupons to your savings card via the grocery stores' web site. I tried this with my Safeway club card and ran into numerous problems.

First, it was difficult to find this capability on the Safeway's site - if my colleague didn't tell me about I never would have found it. Second, there was a very limited selection of coupons. However, the biggest problem was I forgot which coupons I tied to my card. The only way to remember is to jot down the coupons selected or have a fantastic memory - which I don't have so I need to rely on the former approach.

What's the answer - easily storing scannable coupons on your mobile phone. Most people have their phone with them at all times eliminating the problem of forgetting the coupons at home. All that's needed is a web site that allows you to select the coupons, easily download them to your phone, and lastly, an easy to use mobile app that allows you to scan the electronic coupon when you check out. All this technology exists today. The challenge is figuring out how to take it to market.

I'm interested in learning if other people share my frustration with paper based coupons and are appalled at the cost and energy required to process coupons.

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