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STRATEGY

Online Coupon Sites Thriving

As consumers cut their budgets, they're turning to the Internet for savings.
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As consumers slash their budgets and newspaper subscriptions continue to slide, more people are turning to the Internet for coupons. That's good news for entrepreneurs leading the charge to move coupons online.

According to a recent survey of 4,500 women by Burlington, Massachusetts-based online ad network Burst Media, coupon usage is up, and more consumers are turning to the Internet as their source. Thirty-four percent of respondents report using more coupons, while the rate of online users has jumped since 2002, from 3.8 to 16 percent.

"The Internet has become the second most important place for women to get coupons, and when you consider that newspapers have had 60, 70, 80 years of marketing efforts, it's that much more powerful a message for marketing," said Chuck Moran, Burst Media's VP of marketing.

"Our business is growing 20 to 22 percent per month, and we have been for a long time," said Coupons Inc. CEO Steven Boal. And as the downturn has intensified, they've seen growth accelerate. They first noticed shoppers seeking and using coupons more aggressively in September 2007, shortly before the official beginning of the recession.

The company is involved in every stage of production, distribution, and redemption of printable online coupons. As Boal explains, the option is the best of both worlds. The delivery is more efficient, and consumers can take the coupons into brick-and-mortar stores, which still dominate in sales.

According to the Burst Media survey, the option is a popular one—70 percent of respondents would print and use an Internet coupon for an item they want.

Stephanie Nelson, founder of CouponMom.com, has seen an equally dramatic spike in business. Membership for her free online coupon database has skyrocketed over the past year, from 200,000 to 1.6 million.

"Coupon use is certainly a learned behavior," Boal pointed out. He expects as the economy suffers and newspapers wane, younger consumers will learn to use Internet coupons, and even as the nation comes out of the recession, they'll continue to rely on them.

Last updated: May 1, 2009




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