Single Use Coupons: Secure Redemption and Secure Distribution

By Dan Slavin

I speak with potential customers on a daily basis about single use coupons and their questions often seem to be the same. As a result, I thought I would write down the information that I share with them on a regular basis in the hope that it will be helpful for you too.

BENEFITS/FEATURES OF SINGLE-USE COUPONS

Single use coupons have many applications that are unique from multi-use coupons. They can be used:

  1. When it is important to limit liability,
  2. To limit distribution to a limited set of individuals,
  3. To deliver personalized offers, and
  4. To provide perfect attribution for marketing programs.

I will discuss these one at a time:

Using single-use coupons to limit liability:

We often think of offers as being different from coupons. An offer is something that you are happy for as many people as possible to take advantage of – for example, buy 100 pizzas and get one free. I am sure that nearly every pizza restaurant in the world would be happy to provide this offer to its customers. However, what if the offer were to give customers who present the coupon a $10 bill. Suddenly, it becomes super important to make sure that only the people you want to have the coupon can obtain it and that the people who have the coupon can only use it once. This is the essence of a single use coupon. A typical use for single use coupons where you want to limit liability are reward certificates. These are earned by specific customers after spending and you want to make sure that only the person that earned the certificate is able to use it. Since coupons can be sent to marketing lists as well as requested on-demand by consumers, it is important to be able to limit the distribution when delivering on-demand as you may not know the potential volumes being requested ahead of time. Single use coupons allow you to limit the quantity distributed to a specific number to limit your overall liability. Finally, you may have a specific coupon that you are happy to provide to many potential customers, but which you only want a customer to be able to redeem one time regardless of the number of times they request it.

Limiting distribution of single-use coupons to a limited set of individuals:

When sending you are emailing deep discount re-activation offers to specific individuals, you want to make sure that those offers do not go viral and get into the hands of an unlimited number of people you did not send it to. Similarly, you might decide to offer a high value “Welcome” offer to people joining your marketing program. You want to make sure that only those people who joined the program are actually able to receive/use the coupons. If you are using single use coupons and someone posts their coupon to a web site, then they have essentially given their coupon to the first person who brings it to the store, but their coupon cannot be shared/used by many individuals.

Delivering personalized offers:

When your company begins to execute personalized marketing campaigns, it becomes critical to have the ability to deliver single use offers so that you are able to ensure that the special offer that you give to customer A is not generally available to all of your customers. It is difficult to deliver personalized offers and track their effectiveness if “anyone” can access the offer. This leads into the next use for single-use offers:

Providing perfect attribution for marketing programs:

When executing marketing programs, it I important to be able to know exactly what the benefits are of the program being executed. I hear all the time from CFO’s that they are concerned about “leakage” in the reporting they receive on coupon usage. What this means is that when multi-use coupons are used, the CFO’s have little faith that the redemptions came from the specific marketing program vs being posted on a coupon site and therefore becoming a general discount vs a targeted program discount. Single-use coupons solve this problem by providing accurate tracking between the coupon distribution and the redemption. In this way, an individual coupon redemption can be attributed to the specific marketing program view/click/delivery/individual. This tracking works for every channel including digital, online, and even print. Imagine being able to place on online digital ad and knowing the number of views (by site/location), clicks, unique coupons issued, and redemptions tied back to specific marketing dollars spent. This is nearly impossible to do with multi-use coupons.

In order to fully understand how single-use coupons work, we have to break the problem down into two basic capabilities: Secure Redemption and Secure Distribution. Secure Redemption is the core technology component that is required in order to be able to deploy single use coupons. Secure Distribution provides the ability to limit distribution and accurately attribute single-use coupons to individuals and marketing programs.

SECURE REDEMPTION

Let’s talk about Secure Redemption first. Secure Redemption is the ability for the point-of-sale system (POS) or the eComm shopping cart to be able to i) issue and ii) accept and process single use coupons.

It may be obvious to some, but in order to be single-use, each coupon must have a unique promo code/barcode. This uniqueness is what ensures that single-use coupons can be used only once and efficiently tracked. A common question that I have prospective customers ask their POS or eComm team is “Can our POS or eComm shopping cart handle single-use/serialized coupons?” (“Serialized” coupons are another way to describe single-use coupons)

What I mean by handle single use coupons is that if a consumer goes to the POS and presents a coupon or enters a coupon in the eComm shopping cart, the POS or eComm shopping cart is able to i) identify it as a single use coupon, ii) determine whether the coupon is valid, iii) determine if the coupon has never been used before, and iv) if i-iii are true, v) accept the coupon and vi) invalidate the coupon by marking it as redeemed so no one else can use it.

If your POS or eComm shopping cart can do this today, then the next question you need to ask your POS/eComm team is whether or not they are able to provide you with a “stack” of single-use codes. If they can, good for you! You are ready to use single-use codes and you should move on to the next section on Secure Distribution for how to most effectively take advantage of your single-use capabilities.

If you are one of the many businesses that are unable to handle single-use coupons, then you need to find a partner who can add this capability to your POS or eComm shopping cart. My company, CodeBroker, offers one such single-use coupon platform.

You will also need to integrate this platform into your POS or eComm shopping cart. There are two basic capabilities these platforms provide for the POS/eComm shopping cart:

  1. They provide the ability to validate that a coupon is good in real-time. They typically have a real-time API call that accepts (among other things) a coupon code/barcode as input and returns an indicator which tells whether the coupons should be accepted. If the coupon code is recognized and has not been used, then the coupon platform will indicate to the POS/eComm shopping cart that the coupon is valid so that the discount can be taken.

  2. Once the discount has been taken, the POS/eComm shopping cart must inform the coupon platform in real-time that the coupon has been used so it cannot be used again. Real-time is important here to ensure that a customer cannot come back within seconds or minutes and re-use the coupon.

These capabilities can only be supported by real-time integration with the POS or eComm shopping cart. While any integration with POS can be difficult, some couponing platforms make this as easy as possible by employing only 2 API calls to support this integration making it straightforward to add this capability to your existing systems.

Once your POS/eComm shopping cart is able to process single use coupons, you then need to have an easy and fast way to get new single-use codes for your marketing programs. This is the final major requirement for Secure Redemption – you need to have an easy way to obtain codes for your programs. I have heard of situations where it can take many days of waiting to obtain codes. It is important that you are able to obtain these quickly.

Sometimes I speak to customers who can process single use coupons at their POS and/or eComm shopping cart, but the systems don’t talk to each other (imagine that!). This is an unfortunate situation because one of the most common uses for single use codes requires that consumers can only use the codes once either in-store OR online. A reward certificate would be a good example of a single-use coupon that could only be used once.

If you are in this situation, then a single-use coupon platform can help you by i) enabling your POS to accept eComm coupons or ii) your eComm shopping cart to accept single-use POS coupons. The latter is often much easier to implement as it requires little/no change to the POS system (making changes to eComm shopping carts is often much easier than updating POS systems).

Once you have access to Secure Redemption capabilities either via your in-house capabilities or your single-use coupon platform’s Secure Redemption capabilities, it is time to focus on Secure Distribution.

SECURE DISTRIBUTION

Once your POS or eComm system has the ability to handle single use coupons, it is time to focus on Secure distribution. Secure Distribution solves the set of challenges you will face when distributing the single use coupons to your customers. This often comes up when delivering personalized coupons which requires Secure Distribution. (How can you deliver different offers to different consumers and track their behavior if a consumer can simply post an offer to a shopping site or coupon site and suddenly everybody has access to it?) The benefits of Secure Distribution typically fall into one of a number of categories:

  1. Removes risk of offers being used more than once or going viral.
  2. The customer always gets the same mobile offer regardless of number of times she requests it.
  3. Once an offer is redeemed, it expires simultaneously and is marked as redeemed across all channels to prevent re-use.
  4. Enables more accurate, customer-level tracking and attribution so you can attribute purchases directly to marketing efforts.
  5. Deliver offers on multiple channels, to increase engagement and redemption.
  6. Set up coupons for in-store and/or online redemption, with coordinated expiration across all channels.
  7. Ensure that your coupons’ appearance varies with their state (expired, redeemed, etc.).

There are many different ways to deliver coupons. The most common ways are i) to send to customers on marketing or loyalty lists that you have built, and ii) coupons can be requested on demand by a consumer responding to a call to action such as an online ad, a printed ad, or a radio/tv commercial.

When sending coupons to your customers, you want to make sure that they don’t go viral. One way to do this is to deliver a unique coupon code to each customer. Secure Distribution makes it easy to assign or pre-assign coupon codes to your customers as part of the delivery process. Secure Distribution then ensures that your customers get the same coupon regardless of how the coupon is delivered (email, text, app, etc.). Because the coupons are unique, you can be confident that your customer cannot post their coupons on a coupon sharing site for others to use.

Secure Distribution also ensures that if you send your customer their coupon via multiple channels (eg. Email + app) that the customer gets the same coupon code in both channels, thereby ensuring that each customer only receives one coupon.

Secure Distribution also allows you to deliver a live version of the coupon meaning that the “face’ of the coupon always reflects the actual status of the coupon. This means that if the coupon is expired, the coupon code or bar code will no longer be visible and if the coupon has been redeemed, the face of the coupon can present the date/time that the coupon was redeemed. Displaying a “live” coupon also allows you to make emergency changes to the coupon in case something was missed during proofing (eg. A missing disclaimer that the discount cannot be applied to certain products)

Another popular way of delivering single use coupons is called “on demand”. On demand is when a consumer sees a call to action on television, radio, print, or similar and takes some action to request a coupon. This type of coupon can be a very effective way of driving traffic to e-commerce sites and physical store locations. We typically see redemption rates of about 30% to 50% for on-demand coupons.

On demand coupons can also be delivered when consumers are on social media or browsing the web. Because they are single use and securely distributed (ensuring that consumers can only get one), it is then very easy to i) track exactly which adds generated which coupon, ii) the associated revenues that were associated with that and iii) be confident that there is no leakage. Secure Distribution ensures that no matter how many times your customers request coupons, they will always get the same coupon code. The best Secure Distribution systems/methods do not use cookies which makes it very difficult to obtain a second copy of a coupon.

Secure Distribution can also enable you to gamify your coupon distribution by providing a way to execute secure mystery offer and “choose you offer” campaigns while ensuring that consumers can only obtain one offer.

CONCLUSION

Single use coupons powered by Secure Redemption and Secure Distribution open up a world of possibilities for making your couponing programs more effective at revenue and profit generation by enabling improved personalization, superior tracking/attribution, and reducing overall costs by limiting liability and opportunities for coupons to go viral.

For more information on how to deploy single-use coupons at your company, please contact CodeBroker at 800-928-7315 or by clicking here.