Coupons.com Sees Double Digit Growth as Total Revenues Jump 41 Percent in Q1 2014
In its seventh quarter of double-digit gains, digital coupon platform Coupons.com has posted a 41% increase in year-over-year sales, rising to $51.5 million for the first quarter of 2014. The company attributes this growth to an increase in the total number of transactions, defined as the number of digital coupons distributed through the Coupons.com platform that generate revenues, up 30% to $407.8 million.
As of 1:53 PM ET, shares are up 0.16 cents to $16.62, a 0.97% increase.
In an interview, Steven Boal, Founder and CEO, said that the company saw a big rush to its platform by all of its clients as they drove more of their promotion dollars to digital. Indeed, digital coupons are seeing incredible growth. As we previously reported on AndNowUKnow, an eMarketer report suggests that mobile coupon usage is set to increase by 300% by 2014, a rise from 12.3 million in 2010 to 53.2 million in 2014. The report also says that one out of every four mobile phone users will redeem a coupon via a mobile device. This shouldn’t be that surprising. A December 2013 Nielsen report says that consumers are supposedly spending more than 20 hours online per month and more than 30 hours on their phones in the U.S. Check out our previous article on the growth and future of digital coupons below.Click here to read: Digital Coupons: Where Are We Going?
In response to claims that the coupons business is generally a recessionary business, Boal said that the digital coupon business is surprisingly non-cyclical as opposed to counter-cyclical. “When we’re in tough economic times, consumers do turn to coupons for sure, but that tends to be a learned behavior,” he said. “When the economy strengthens, they continue to use the coupons. Conversely, when the economy gets stronger, people adopt digital more. They’re using mobile phones more often and they’re using a full digital experience, and our company grows during that time.”
Boal still says there’s a place for paper coupons, however. He noted that while 99% of coupons (representing 315 billion coupons) are still distributed through the Sunday newspaper, less than 1% is redeemed. Meanwhile, 1% is digital, but there’s a 15% redemption rate. “So 7% to 10% of all coupon redemption is digital,” Boal claimed.
It’s clear that the digital coupon business is expanding, and Coupons.com is capitalizing on that growth. Last month, the company announced Retailer iQ, a targeting and analytics platform that combines digital e-receipts, personalized recommendations for products and coupons, integrated shopping lists, and real time analytics. Where else can digital coupons go from here? Stay tuned to AndNowUKnow as we continue our coverage on the growth of digital coupons.
