How retailers can ramp up to Step 4
OAKBROOK TERRACE, Ill. -- It’s the middle of summer and I’m thinking hockey sticks. Not hockey sticks as in the 2015 Stanley Cup-winning Chicago Blackhawks—go Hawks!—but the learning “curve” so often associated with technological advances, going from a slowly increasing line to a sudden soar upward. In this case, I’m considering digital coupons and the opportunity for convenience stores.
Benefits of people using their mobile phones to receive and redeem digital coupons means a ton to retailers, everything from increased customer affinity to new promotional dollars from consumer packaged goods (CPG) companies. (Watch for the upcoming September issue of CSP magazine.)
Yet for many, the first step is understanding how far along that learning curve the channel is.
I had a chat recently with Brad Van Otterloo, vice president of client development with Koupon Media, Dallas, who gave me his take on the evolution of digital coupons at convenience stores. His company has worked with, among others, Dallas-based 7-Eleven. Here’s how he read the stone tablets:
Step 1: Mobile bar codes. When digital coupons first sprang up about four years ago, they were barcodes on mobile devices. Essentially, the technology put what was on paper (a printed barcode) and forced it onto a mobile format. The biggest problem was fraud. With paper at least, the cashier could put the clipped coupon into a cash drawer. With early mobile coupons, people could use them over and over again.
Step 2: Setting time limits. Working around the fraud obstacle, techies figured out a way to put limits on digital coupons, with offers expiring after 15 minutes, for example.
Step 3: Geolocation. If customers give permission, mobile phones could identify their locations, which allows for a time stamp, user ID and the store that takes the coupon.
Step 4: Unique bar codes. Technology is about to offer unique bar codes. That means the bar code exists only for a single use. Once scanned, a cashier can’t scan it again.
Not all retailers are ready to go from nothing to Step 4, Van Otterloo told me, but like that hockey stick, retailers start by ramping up. The speed of innovation moves much faster than four years ago. Once people get their feet wet (or chilled if I carried the hockey metaphor further), lessons build on themselves and soon snowball.