This Week's Agenda: Coupons for Christmas

Please don't tell my son about this article.

A month or so ago, his milk jugs began featuring a "contest" called Cyber Loot. Game pieces were glued to the screw-top. Most were losers.

But one was a winner. It bore a complex number and instructions to cash in the prize at www.cyberloot.com. The "prize" was a $10 discount on a selection of Electronic Arts video games. My son loves "SimCoaster," and one game listed was "SimCity 3000." The final price, including shipping, came to about $25.

It all turned out to be a clever application of a trend you need to get in on, namely online coupons. It can make your Christmas. It's already made my son's.

An eMarketer online advertising report, released last week, showed how powerful coupons can be.

Online consumers said they cared mostly about return policies, customer service, and product selection. But coupons work, partly because only 41 percent of shoppers were satisfied with those customer service measurements when shopping online.

Online coupons represent only 10 percent of all coupons, but a very impressive 94 percent of online coupon users have shopped online before.

Scott Ferber, CEO of Advertising.com, recently sponsored a survey on online promotions, which also applied some numbers to this trend.

"About 25 percent of all respondents will buy online in some way, shape, or form," he said. "Of that 25 percent, 76 percent said promotions were a positive influence on their buying behavior. Some 50 percent said online coupons were especially persuasive."

Ferber offered some coupon guidelines based on his survey and his experience:

• Online coupons work well for considered purchases, such as electronics, and online stalwarts, such as music, toys, and clothing.

• Simplicity is the key to a successful coupon effort. "Don't crowd the copy," said Ferber. "Don't ask too much of the customer."

• To make your own bottom-line results more powerful, consider increasing the benefit for multiple purchases.

• Make online coupons viral. Given the holiday season, you might send an e-greeting card that includes your discount. Recipients can then forward it on to family and friends.

My son's milk jug is a good example of offline coupons that drive people to an online store. Ferber said he's seen great results from adding online coupons to the back of cash register tapes.

The system works in the opposite direction, too, asserts Ferber. This can help you save Christmas, even if your numbers aren't adding up on December 1. He suggests that you offer via email coupons that drive customers into your physical stores during the last weeks of the shopping season.

This takes some care. You need to have physical addresses or Zip Codes in your email database so that you can filter the recipients and not send customers coupons they can't redeem.

"Responsible subscriber management is critical to retaining customer loyalty," said Ferber. If people aren't responding to your email, you should drop them from your list, just as you'd drop them from a snail-mail list.

Use offline coupons now to drive online buying and online coupons later to drive offline buying. The method may make for a very merry Christmas and survival into the new year.