In five years’ time, analysts predict that the global value of the mobile coupon market will top £27 billion in annual earnings. Given that the market will make an estimated £3.4 billion in 2011, it is clear that some are expecting explosive growth in this sector.
The major benefits of mobile coupons identified in a report published by Juniper Research include an increased ability for companies to target potential customers with a greater degree of accuracy than they might by using other traditional mediums. Because mobile phone coupons can be aimed at people with appropriate lifestyles and even use GPS data to enact location-based campaigns, a greater degree of efficiency is ensured.
Mobile coupons are not defined by a single technology or marketing strategy. Instead, the growth of smartphones allows companies to appeal to consumers through QR codes, NFC (Near Field Communication) ready hoardings and cross channel compatibility with web based services.
The flexibility of the application download services that are available on all major smartphone platforms is further expanding the market. Upcoming apps are being developed to allow users to compare and contrast coupons based on their current location and savvy businesses of all sizes will sign up to such programs so that their promotions and offers are highly visible to an increasingly well connected consumer base.
It is this potential to provide context to mobile coupon offers that makes them relevant to consumers and thus valuable to businesses. Some experts are concerned that companies will begin to bombard consumers with mobile coupons, quickly fatiguing the market and spoiling this budding relationship. They are calling for advertisers to take care and target campaigns precisely to ensure that consumers remain engaged and there is enough on the table to convince them that they should put aside their previous brand loyalties and perhaps try using a competitor.
In the long term this will be about more than just the discounts and short term deals. There are some sceptics who believe that the culture of mobile coupons will just encourage a more fragmentary market where consumers dip into a business just once to take advantage of an offer and then never return. However, statistics show that people who use coupons part with more cash than they might have done had they not been brought on-board by an offer, which suggests that there are real benefits which go beyond simple frugality.
In fact, one mobile coupon start-up, which is launching in the US, is attempting to combine the ethos of offers with rewards for loyalty. Shopkick uses the location of the consumer to give them offers when they arrive at relevant retailers’ outlets. If they come back regularly they will get a loyalty reward in the form of points which can be redeemed for cash or reinvested in-store. Loyalty schemes are nothing new, but initiating one that operates across multiple retailers shows just how enterprising it is possible to be in the world of mobile coupons.
Ideally, the mobile coupon market will benefit small businesses as well as established brands. According to David Snow, the man behind the Juniper Research report into the market, there will be great opportunities for growing companies to tap into mobile coupons because the requirements for entry are low and the rewards in terms of sales increases and customer loyalty will be significant. Mr Snow believes that any organisations that fail to recognise the inevitable rise of mobile coupons will be left behind.
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