PROMOTIONS
SECTION ONE
SECTION TWO
 |
Seven Misconceptions about Coupon Holograms
The Coupon Information Center has made available a new universal hologram for
marketers. Holograms are three-dimensional photographic images that are printed
on a special foil. They are intended to be used on the free and high-value coupons
to deter the distribution of unauthorized copies, solving a long-standing industry problem. Most consumer packaged goods marketers will issue these coupons bearing the special standardized hologram during the first half of this year.
Defining “high-value” is up to the coupon issuer. In most cases, it is a matter of “dollars off” rather than “cents off.” With product costs rising - along with the value of coupon offers - the potential of losses due to counterfeiting can be very significant.
There is an extra cost to putting the hologram on coupons, estimated by some in the industry at 2 or 3 cents per coupon. So it is not cost-effective to use it on every offer. But fraud on the free and high-value coupons can cost issuers hundreds of thousands, and even millions of dollars. There is a clear return on investment.
Meanwhile, some CPG marketers and retailers are misinformed about coupon holograms. Here are seven common misconceptions along with the straight story.
Retailers will have to pay for added costs in developing the hologram process.
False. The entire cost of this program is being paid for by the CIC and the participating manufacturers. There will be no costs for retailers. If anything, retailers should have a direct financial benefit from the program as they will be less likely to be victimized by counterfeiters. Retailers may not be reimbursed for counterfeit coupons, and with high-value coupons, losses can add up quickly and significantly.
There’s no way to stop coupon counterfeiting completely.
True. However, that doesn’t mean the industry should wave the white flag and give up. Most counterfeit coupons are created on home or office equipment, which can’t be used to create holograms. But there are professionals out there with sophisticated printing equipment. This represents a minority of abuses that will be addressed in the future.
CIC has another free program called the CIC Early Warning System to assist retailers that would like to protect themselves from counterfeits at the point of sale. Interested retailers can contact CIC at aa@couponinformationcenter.com for details. Please include full contact information, including fax number.
The combination of the CIC hologram and the new CIC Early Alert System will substantially diminish the financial threat of counterfeit coupons at no cost to retailers.
A single counterfeit coupon cannot possibly result in $1 million in losses.
False. Because of the high-dollar value of some coupons that have gone viral on the Internet, there have been several instances when a single counterfeit coupon has cost the industry between $1 to $2 million. Unfortunately, specific manufacturers or brands cannot be named.
The hologram does not address problems with digital coupon offers.
True. The hologram is only intended to stop the counterfeiting of paper coupons. Putting holograms on coupons is a mechanical process involving a uniquely designed shim and special foil. It is a technology that can’t be reproduced on home or office printers, so it can’t be used for digital coupons.
Companies wanting to improve the security of high-value/free digital coupons have several options: take their chances with digital and no protection; protect their digital coupons some other way, like loading the offer on a loyalty card; or go back to print coupons where they can use holograms.
Cashiers can be depended on to notice and authenticate a coupon hologram.
True. The cashiers who are the ambassadors of the retail industry should not be underestimated. The holograms are instantly recognizable — they stand out from other documents the cashier is handling, and cashiers are already getting used to looking for them. Prior to the new standardized hologram, several variations were created, resulting in some confusion. Now there is one universal identifier that is easy for cashiers to recognize.
By adding the holograms to the CIC Early Alert System, CIC hopes the large wave of counterfeit coupons will be stopped. The talent and the technology have come together to make substantial progress in this area, if the retailers are ready to participate.
There is little benefit to putting holograms on all CPG coupons because most are low-value offers. Also, the definition of what is “high value” is vague.
True. The CIC hologram is intended for free and high-value coupons. It would be desirable if they could be applied to all printed coupons, but hologram technology is a challenge and is expensive.
As to vagueness in the standard, value is in the eye of the beholder. Some holograms have been affixed to coupons valued as little as a dollar.
All marketers issuing coupons must participate in the hologram program.
False. Each manufacturer must set its own, independent coupon redemption policy and practices.
CIC can’t mandate anything - and wouldn’t if it could. However, the hologram has been very effective and has already saved the industry millions of dollars. Additionally, as more manufacturers use the hologram on their coupons, it will become more recognizable
The CIC has also found that the counterfeiters know who the CIC members are and often shy away from attempting to counterfeit their coupons. In this manner, the CIC hologram may also act as a “No Trespassing” sign to the criminal element.
This article was developed by the editors from conversations with Bud Miller, executive director, Coupon Information Center, Alexandria, Va. More information can be obtained at www.couponinformationcenter.com. Current CIC members are: Altria, Beiersdorf, Clorox, ConAgra, Coca-Cola USA, Colgate-Palmolive, Del Monte, Energizer, General Mills, GlaxoSmithKline, Hanesbrands, Hasbro, Horme,; JM Smucker, Johnson & Johnson, Kellogg, Kimberly-Clark, Kraft Food, Land O’Lakes, Lorillard, Mead-Johnson, Med Foods, McCormick, Nestle USA, PepsiCo, Pfizer, Post Foods, Procter & Gamble, Reckitt Benckiser, Reynolds Consumer Products, R.J. Reynolds Tobacco, S.C. Johnson & Son, Sun Products, and Unilever.
Click on the LinkedIn logo to join the new Shopper Technology Institute Discussion Group
SECTION THREE
