The History of CouponingFeb 10, 2022 | 0 Votes by Mel - rate Anyone who has shopped online or in-store is likely familiar with the concept of coupons. Coupons are beneficial to consumers to get amazing discounts and deals. But, have you ever wondered when and why manufacturers and retailers offer coupons? In this article, we’ll discuss a brief history of coupons and the various ways they have been helping consumers save for over 130 years.
While most of us are familiar with the storied history of Coca-Cola, it is a little-known fact that the brand behemoth is also directly responsible for the official invention of the consumer “coupon” when, in 1888, it issued hand-written tickets offering a "free glass of Coca-Cola” (then priced at 5 cents). Considered the earliest documented coupon, these free Coke vouchers were mailed to potential customers and placed in magazines. It is estimated that between 1894 and 1913 one in nine Americans had received a free Coca-Cola, for a total of 8,500,000 free drinks. By 1895, Coke was served in every state in the United States on its way to becoming one of the most recognized brands around the world and of all time.
Seeing a genius marketing gimmick that they could also capitalize on, other brands began to distribute coupons of their own, with cereal manufacturer C.W. Post offering coupons with a one cent discount on Grape Nuts cereal in 1909.
Coupons gained even more relevancy when millions of struggling Americans took advantage of coupons to cut weekly food expenses during The Great Depression. In 1929, Betty Crocker began a loyalty points program that included issuing coupons that could be used to redeem for premiums like free flatware. In 1937, the coupons were printed on the outside of Betty Crocker food packages, a program that continued until 2006—one of the longest continuing loyalty programs in retail history.
Even after The Great Depression, coupon usage became commonplace, especially with the hostilities of World War 2. Coupons became even more widespread when chain supermarkets began offering store coupons in 1940 as a means of drawing customers away from neighborhood stores. When the supermarkets made their debut, they failed to attract shoppers. Although they had a wide variety of food items, the costs of using your vehicle to travel to these supermarkets was considered simply not worth it in those times. In order to encourage people to patronize their aisles, supermarkets introduced the very first “in-store coupons” for grocery items that easily offset the cost of gas.
Starting in 1957, coupons diverged from being used exclusively by grocery items to being applied to other non-food products such as fuel. With merchants left and right coming up with their own coupons with little to no regulation, the Nielson Coupon Clearing House was also created in 1957 to sort, count and tabulate coupons to determine how much money was owed to each retailer.
By 1965, half of all American households were clipping coupons with the Sunday newspapers nationwide adopting the practice of including “weekly ad circulars”—inserts with coupons promoting everything from fast food to bank checks—within their pages. Furthermore, direct mail co-ops provided local businesses with an inexpensive way of distributing coupons, while other innovations such as printing coupons on the back of receipts based on a consumer's purchases and electronic shelf coupons also encouraged point-of sale purchases.
New technologies in the 1990s led to the first Internet-delivered, printable coupons. The popularity of the money-saving device reached astonishing levels in 1997, when 83% of Americans used coupons, redeeming 4.8 billion coupons and saving a total of $2.9 billion. By 1999, savings reached $3.6 billion each week.
With smartphones making up the majority of cellphones in 2008, the introduction of scannable mobile phone coupons which could be cashed out on checkout meant that merchants could reduce overheads while cutting out the middleman. By 2011, with online shopping accounting for 7% of total retail purchases, digital coupons invaded every possible market, from groceries and clothes to electronic gadgets and services. In 2013, coupon usage grew to 97 million online consumers in the USA alone, with 60% of coupons used for non-food items such as apparel, travel and tourist services, office supplies, and much more.
Today, shoppers now expect all online and brick-and-mortar retailers to offer some sort of coupon as a way to retain loyalty. And far from the days of offering a free glass of soda or a 1¢ discount, there are now a wide range of coupons types offering different types of values, such as free shipping, bulk savings, buy-one get-one, trade-in for redemption, loyalty rewards points, first-time customer discounts, free trial offers, launch offers, holiday offers, cash back vouchers, free giveaways, and more.
One of the more widely utilized and distributed types of coupons are those offered by stores through email marketing and newsletter subscriptions. These special promotions come in the form of promo codes which can be applied during checkout.
On top of that, in the current Internet-driven retail ecosystem digital coupons are outperforming traditional print coupons in influencing customer purchase decisions. Unlike the traditional coupons, digital coupons reach more customers as you can leverage modern communication platforms including email, mobile, social media, and third-party coupon vendors.
130 years since Coca-Cola came up with the first voucher, coupons still continue to be a popular way for consumers to save. They are especially relevant as eCommerce continues to grow as a primary way for people to shop, egging marketers and retailers to constantly come up with even more exciting and innovative ways to engage customers and encourage more shopping.