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5 Apr, 2010 By: Jacqueline Renfrow Response


Valpak Is in the Midst of a Digital Coupon Revolution

By Jacqueline Renfrow (jrenfrow@questex.com)

Valpak.com has become a major factor in the company’s coupon redemption rates. There are now more than 14,000 advertisers on the Web site.In the down economy, coupon use is increasing 26 percent year-over-year and while most of these coupons come from direct mail, 10 million digital coupons were redeemed in the first half of 2009 — a 25-percent growth from the previous year. One company at the forefront of the digital coupon revolution is Valpak, the familiar blue envelope filled with advertisements and offers that reaches 45 million homes and businesses.

In addition, Valpak.com offers more than 17,000 printable coupons, and through partnerships with Web sites such as Kudzu.com, customers searching on Valpak.com can view customer reviews and ratings for local service providers.

The 40-year-old national and local coupon provider refuses to get behind the times with the latest marketing trends. In fact, ahead of many in the channel, Valpak has put a large emphasis on digital in the past couple of years — taking digital from sideshow act to the main attraction in 2008. Working with parent company Cox Target Media Inc. — it started a cross-departmental team to pull it all together and push new products — Valpak officially moved from a print-only to a print-and-digital company, and in July 2009, the company decided to explore the mobile space.

First on the innovation scale came an iPhone and iPod Touch app in September 2009. Then came a platform for the Android Palm Pre in November and December, all of which can download the same 17,000 savings opportunities from the Web to a consumer’s phone. Also, in February, those that are a retailers/advertisers on Valpak’s digital products are also a part of 150 other Web sites that offer value to consumers, including coupon sites, value sites, mommy blogs, etc.

The partnership with other Web sites allows a Valpak advertiser to set up an XML feed into the partner’s site and when a customer prints the coupon, it is actually printed from Valpak.com. This overall strategy gives advertisers access to more than 32 million unique visitors per month.

“We have a national advertiser who in May 2009 averaged 2,900 prints a month, and now [since partnering with Valpak] averages nearly 5,000. So we believe it’s working,” says Jim Buckley, director of new media business development at Valpak.

About 12 percent of the advertisements sold for Valpak are national. In the print world, it’s about 15 percent national and the rest is local businesses. Online, the scales tip to 20 percent national and 80 percent local — as of January, the company had 26,000 advertisers in the Valpak mailer and 14,700 advertisers on Valpak.com.

Though the balance is still not a perfect match, the strategy is to become a combined digital and print solution for advertisers. Multiple platform advertisers are significantly better positioned to get results than a single platform advertiser.

“In our case, looking at our retention rates (over a 13-month period), we saw we retained a customer for a second cycle and our digital and print results are 5-to-7-percent higher when a customer runs on both platforms,” says Buckley.

From a strategic standpoint, Valpak decided to go digital so it could be accessible to consumers everywhere. So, if a customer is associated with a local offer, the coupon comes as a physical coupon in the mail and it will also appear digitally on the phone.

Buckley says the company has the holy grail: local content that an individual company needs to get consumers onto their platform. He stresses that Valpak is an application for the phone. For those technologically equipped, the phone itself is GPS capable — letting Valpak know where the customer is located — and then it delivers all coupons in that search radius. A customer can search anywhere from three miles up to a 25-mile radius. Buckley says it’s not about pushing a coupon on a consumer, but offering coupons in the realm of what they are searching for in that local radius.

Financially, Buckley sees an integrated package with Valpak as a relatively inexpensive buy for a marketer. For example, in Atlanta, an advertising partner can pay $400 a month and get all of the following: three digital coupons on Valpak.com with a link to the advertiser’s Web site and link to the print ad and social bookmarks; a Kudzu.com rating/review and profile page; presence on more than 40 Valpak partners and more than 86 of Kudzu’s partners, Google Mobile, Valpak Mobile and more than 125 Web sties; and a Valpak Smartphone Application.

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