Advertisement

Springer Nature is making SARS-CoV-2 and COVID-19 research free. View research | View latest news | Sign up for updates

Targeted reminders of electronic coupons: using predictive analytics to facilitate coupon marketing

Abstract

Electronic coupon (e-coupon) is one of the most important marketing tools in B2C e-commerce. To improve the e-coupon redemption rate and reduce marketing costs, it is crucial to retarget customers who have received e-coupons and have higher propensity to redeem their coupons. Using log data and transactional data to extract the features of past purchase behavior, past coupon redemption behavior and browsing behavior during coupon validity period, we investigate the factors influencing customers’ propensity for e-coupon redemption. Our results show that almost all the variables used in our analysis (except the visit time) affect consumers’ coupon redemption propensity. Our study can help companies develop promotional strategies that better retarget those customers who are more likely to respond to coupon marketing. It also highlights the potential of using predictive analytics to enhance marketing effectiveness in the era of big data.

This is a preview of subscription content, log in to check access.

Fig. 1
Fig. 2

References

  1. 1.

    Lamb, C. W., Hair, J. F., & McDaniel, C. (2004). Marketing, 7e. Mason: Thomson Southwestern.

  2. 2.

    Narasimhan, C. (1984). A price discrimination theory of coupons. Marketing Science,3(2), 128–147.

  3. 3.

    Beane, T. P., & Ennis, D. M. (1987). Market segmentation: A review. European Journal of Marketing,21(5), 20–42.

  4. 4.

    Blundo, C., Cimato, S., & De Bonis, A. (2005). Secure E-coupons. Electronic Commerce Research,5(1), 117–139.

  5. 5.

    Jayasingh, S., & Eze, U. C. (2009). Exploring the factors affecting the acceptance of mobile coupons in Malaysia. IEEE Computer Society. https://doi.org/10.1109/ICMB.2009.63.

  6. 6.

    VALASSIS. (2017). Coupon intelligence report “influencing consumers along the path to purchase”. Retrieved March 14, 2018, fromhttp://intelligence.valassis.com/rs/275-QRU-089/images/PDF-Coupon-Intelligence-Report.pdf.

  7. 7.

    Jung, K., & Lee, B. Y. (2010). Online vs. offline coupon redemption behaviors. International Business & Economics Research Journal,9(12), 23–36. https://doi.org/10.19030/iber.v9i12.345.

  8. 8.

    Pei, Y. L., Cheha, N., Kitchen, P. J., & Alwi, S. F. S. (2014). Coupon redemption behavior: A Malaysian cross-segment investigation. Marketing Intelligence & Planning,32(1), 66–88. https://doi.org/10.1108/MIP-05-2013-0089.

  9. 9.

    Swaminathan, S., & Bawa, K. (2005). Category-specific coupon proneness: The impact of individual characteristics and category-specific variables. Journal of Retailing,81(3), 205–214. https://doi.org/10.1016/j.jretai.2005.07.004.

  10. 10.

    Johnson, E. J., Hershey, J., Meszaros, J., & Kunreuther, H. (1993). Framing, probability distortions, and insurance decisions. Journal of Risk and Uncertainty,7(1), 35–51. https://doi.org/10.1007/BF01065313.

  11. 11.

    Botzen, W. W., de Boer, J., & Terpstra, T. (2013). Framing of risk and preferences for annual and multi-year flood insurance. Journal of Economic Psychology,39, 357–375. https://doi.org/10.1016/j.joep.2013.05.007.

  12. 12.

    Ailawadi, K. L., & Gupta, S. (2014). Sales promotions. History of Marketing Science,2(5569), 868. https://doi.org/10.1142/9789814596480_0017.

  13. 13.

    Ben-Zion, U., Hibshoosh, A., & Spiegel, U. (2000). Price discrimination by coupons restriction. International Journal of the Economics of Business,7(3), 325–331. https://doi.org/10.1080/13571510050197221.

  14. 14.

    Reimers, I., & Xie, C. (2019). Do coupons expand or cannibalize revenue? Evidence from an e-Market. Management Science,65(1), 286–300. https://doi.org/10.1287/mnsc.2017.2934.

  15. 15.

    Clark, R. A., Zboja, J. J., & Goldsmith, R. E. (2013). Antecedents of coupon proneness: A key mediator of coupon redemption. Journal of Promotion Management,19(2), 188–210. https://doi.org/10.1080/10496491.2013.769475.

  16. 16.

    Moreau, P., Krishna, A., & Harlam, B. (2001). The manufacturer-retailer-consumer triad: Differing perceptions regarding price promotions. Journal of Retailing,77(4), 547–569. https://doi.org/10.1016/S0022-4359(01)00059-8.

  17. 17.

    Hartmann, W. R. (2010). Demand estimation with social interactions and the implications for targeted marketing. Marketing Science,29(4), 585–601. https://doi.org/10.1287/mksc.1100.0559.

  18. 18.

    Kenny, D., & Marshall, J. F. (2000). Contextual marketing: the real business of the internet. Harvard Business Review,78(6), 119–125. https://doi.org/10.1023/a:1008782230869.

  19. 19.

    Hariharan, V. G., Talukdar, D., & Kwon, C. (2015). Optimal targeting of advertisement for new products with multiple consumer segments. International Journal of Research in Marketing,32, 263–271. https://doi.org/10.2139/ssrn.2555682.

  20. 20.

    Ozcelik, A. B., & Varnali, K. (2019). Effectiveness of online behavioral targeting: A psychological perspective. Electronic Commerce Research and Applications,33(1), 100819. https://doi.org/10.1016/j.elerap.2018.11.006.

  21. 21.

    Yoldar, M. T., & Özcan, U. (2019). Collaborative targeting: Biclustering-based online ad recommendation. Electronic Commerce Research and Application,35(3), 1–17. https://doi.org/10.1016/j.elerap.

  22. 22.

    Choudhary, V., & Shivendu, S. (2017). Targeted couponing in online auctions. Information Systems Research,28(3), 490–510. https://doi.org/10.1287/isre.2017.0688.

  23. 23.

    Lessmann, S., Haupt, J., Coussement, K., & Bock, K. (2019). Targeting customers for profit: An ensemble learning framework to support marketing decision-making. Information Science. https://doi.org/10.1016/j.ins.2019.05.027.

  24. 24.

    Zeng, M., Cao, H., Chen, M., & Li, Y. (2019). User behaviour modeling, recommendations, and purchase prediction during shopping festivals. Electronic Markets,29, 263–274. https://doi.org/10.1007/s12525-018-0311-8.

  25. 25.

    Kitchen, P. J., Alwi, F. S. S., Che-Ha, N., & Lim, Y. P. (2014). Coupon redemption behaviour: A Malaysian cross-segment investigation. Marketing Intelligence & Planning,32(1), 66–88. https://doi.org/10.1108/mip-05-2013-0089.

  26. 26.

    Ashworth, L., Darke, P. R., Schaller, M., Ashworth, L., Darke, P. R., & Schaller, M. (2005). No one wants to look cheap: Trade-offs between social disincentives and the economic and psychological incentives to redeem coupons. Journal of Consumer Psychology,15(4), 295–306. https://doi.org/10.1207/s15327663jcp1504_4.

  27. 27.

    Bagozzi, R. P., Baumgartner, H., & Yi, Y. (1992). State versus action orientation and the theory of reasoned action: An application to coupon usage. Journal of Consumer Research,18(4), 505–518. https://doi.org/10.1086/209277.

  28. 28.

    Rossi, P. E., Mcculloch, R. E., & Allenby, G. M. (1996). The value of purchase history data in target marketing. Marketing Science,15(4), 321–340. https://doi.org/10.1287/mksc.15.4.321.

  29. 29.

    Ferrer-Gomila, J., et al. (2018). A survey on electronic coupons. Computers & Security,77(8), 106–127. https://doi.org/10.1016/j.cose.2018.03.007.

  30. 30.

    Fortin, D. R. (2000). Clipping coupons in cyberspace: A proposed model of behavior for deal-prone consumers. Psychology & Marketing,17(17), 515–534. https://doi.org/10.1002/(SICI)1520-6793(200006)17:6<515::AID-MAR5>3.0.CO;2-B.

  31. 31.

    Kang, H., Hahn, M., Fortin, D. R., Yong, J. H., & Eom, Y. (2006). Effects of perceived behavioral control on the consumer usage intention of e-coupons. Psychology & Marketing,23(10), 841–864. https://doi.org/10.1002/mar.20136.

  32. 32.

    Khajehzadeh, S., Oppewal, H., & Tojib, D. (2014). Consumer responses to mobile coupons: The roles of shopping motivation and regulatory fit. Journal of Business Research,67(11), 2447–2455. https://doi.org/10.1016/j.jbusres.2014.02.012.

  33. 33.

    Mills, P., & Zamudio, C. (2018). Scanning for discounts: Examining the redemption of competing mobile coupons. Journal of the Academy of Marketing Science,46(5), 964–982. https://doi.org/10.1007/s11747-018-0592-7.

  34. 34.

    Tang, Q., Liu, F., Liu, S., & Ma, Y. (2019). Consumers’ redemption behavior of recommended mobile coupons in social network sites. Management Decision. https://doi.org/10.1108/md-03-2017-0234.

  35. 35.

    Zhang, J., & Fang, C. (2017). What does delay in coupon redemptions imply? An investigation into customers’ future purchase probability. In 2017 International conference on service systems and service management, 1618 June 2017, Dalian, China. https://doi.org/10.1109/ICSSSM.2017.7996198.

  36. 36.

    Chiou-Wei, S. Z., & Inman, J. J. (2008). Do shoppers like electronic coupons? A panel data analysis. Journal of Retailing,84(3), 297–307. https://doi.org/10.1016/j.jretai.2008.07.003.

  37. 37.

    Zhang, J. C., Savage, S. J., & Chen, Y. (2015). Consumer uncertainty and price discrimination through online coupons: An empirical study of restaurants in Shanghai. Information Economics and Policy,33, 43–55. https://doi.org/10.1016/j.infoecopol.2015.10.002.

  38. 38.

    Reichhart, P., Pescher, C., & Spann, M. (2013). A comparison of the effectiveness of e-mail coupons and mobile text message coupons for digital products. Electronic Markets,23(3), 217–225. https://doi.org/10.1007/s12525-013-0129-3.

  39. 39.

    Inman, J. J., & McAlister, L. (1994). Do coupon expiration dates affect consumer behavior? Journal of Marketing Research,31, 423–428. https://doi.org/10.2307/3152229.

  40. 40.

    Ragunathan, T., Battula, S. K., Jorika, V., Mounika, C., Sruthi, A. U., & Vani, M. D. (2015). Advertisement posting based on consumer behaviour. Procedia Computer Science,50, 329–334. https://doi.org/10.1016/j.procs.2015.04.040.

  41. 41.

    Ranganathan, C., & Jha, S. (2007). Examining online purchase intentions in B2C e-commerce: Testing an integrated model. Information Resources Management Journal (IRMJ),20(4), 48–64. https://doi.org/10.4018/irmj.2007100104.

  42. 42.

    Alshurideh, M., Nicholson, M., & Xiao, S. (2012). The effect of previous experience on mobile subscribers’ repeat purchase behaviour. European Journal of Social Sciences,30(3), 366–376. https://doi.org/10.1016/j.sbspro.2012.03.058.

  43. 43.

    Jacoby, J., & Chestnut, R. W. (1978). Brand loyalty: Measurement and management. Wiley, New York.. https://doi.org/10.2307/3150623.

  44. 44.

    Haughey, J. C. (1997). The loyalty effect. Business Ethics Quarterly,7(4), 145–150. https://doi.org/10.2307/3857215.

  45. 45.

    Romaniuk, J., & Dawes, J. (2005). Loyalty to price tiers in purchases of bottled wine. Journal of Product and Brand Management,14(1), 57–64. https://doi.org/10.1108/10610420510583752.

  46. 46.

    Lee, J. Y., & Brown, M. G. (1985). Coupon redemption and the demand for frozen concentrated orange juice: A switching regression analysis. American Journal of Agricultural Economics,67(3), 647–653. https://doi.org/10.2307/1241088.

  47. 47.

    Cotton, B. C., & Babb, E. M. (1978). Consumer response to promotional deals. The Journal of Marketing. https://doi.org/10.2307/1250544.

  48. 48.

    Chiang, H. H., Lin, H. Y., & Tu, S. C. (2013). Analyzing behaviors influencing use of mobile coupons from the perspective of transaction utility. Social Behavior and Personality: an International Journal,41(3), 433–441. https://doi.org/10.2224/sbp.2013.41.3.433.

  49. 49.

    Lichtenstein, D. R., Netemeyer, R. G., & Burton, S. (1990). Distinguishing coupon proneness from value consciousness: An acquisition-transaction utility theory perspective. The Journal of Marketing. https://doi.org/10.2307/1251816.

  50. 50.

    Garretson, J. A., & Burton, S. (2003). Highly coupon and sale prone consumers: Benefits beyond price savings. Journal of Advertising Research,43(2), 162–172. https://doi.org/10.2753/JOA0091-3367390203.

  51. 51.

    Chen, M. F., & Lu, T. Y. (2011). Modeling e-coupon proneness as a mediator in the extended TPB model to predict consumers’ usage intentions. Internet Research,21(5), 508–526. https://doi.org/10.1108/10662241111176344.

  52. 52.

    Achadinha, N. M. J., Jama, L., & Nel, P. (2014). The drivers of consumers’ intention to redeem a push mobile coupon. Behaviour and Information Technology,33(12), 1306–1316. https://doi.org/10.1080/0144929X.2014.883641.

  53. 53.

    Kapferer, J. N., & Laurent, G. (1985). Consumers’ involvement profile: New empirical results. ACR North American Advances. https://doi.org/10.2307/3151549.

  54. 54.

    Babakus, E., Tat, P., & Cunningham, W. (1988). Coupon redemption: A motivational perspective. Journal of Consumer Marketing,5(2), 37–43. https://doi.org/10.1108/eb008224.

  55. 55.

    Robert, B.C. (2013). Influence: Science and Practice (5th ed.). Boston: Pearson Education. ISBN 978-1292022291.

  56. 56.

    Bowman, R. D. (1980). Couponing and rebates: Profit on the dotted line. New York: Lebhar-Friedman Books.

  57. 57.

    Zielke, S., & Wierich, R. (2014). How retailer coupons increase attitudinal loyalty—The impact of three coupon design elements. Social Science Electronic Publishing,48(3/4), 699–721. https://doi.org/10.1108/EJM-01-2012-0030.

  58. 58.

    Lee, H. S., & Yeu, M. S. (2010). Factors influencing the intention to redeem coffee shop coupons in Korea. International Journal of Business and Management,5(7), 92. https://doi.org/10.5539/ijbm.v5n7p92.

  59. 59.

    Bucklin, R. E., & Sismeiro, C. (2009). Click here for Internet insight: Advances in clickstream data analysis in marketing. Journal of Interactive Marketing,23(1), 35–48. https://doi.org/10.1016/j.intmar.2008.10.004.

  60. 60.

    Parsons, A. G. (2002). Non-functional motives for online shoppers: Why we click. Journal of Consumer Marketing,19(5), 380–392. https://doi.org/10.1108/07363760210437614.

  61. 61.

    McFadden, D. (1973). Conditional logit analysis of qualitative choice behavior. In P. Zarembka (Ed.), Frontiers in econometrics (pp. 105–142). New York: Academic Press.

Download references

Acknowledgements

This research was supported by the National Natural Science Foundation of China under Grant Nos. 71771122, # 71271115.

Author information

Correspondence to Xiaotong Li.

Ethics declarations

Conflict of interest

On behalf of all authors, the corresponding author states that there is no conflict of interest.

Additional information

Publisher's Note

Springer Nature remains neutral with regard to jurisdictional claims in published maps and institutional affiliations.

Rights and permissions

Reprints and Permissions

About this article

Verify currency and authenticity via CrossMark

Cite this article

Li, L., Li, X., Qi, W. et al. Targeted reminders of electronic coupons: using predictive analytics to facilitate coupon marketing. Electron Commer Res (2020). https://doi.org/10.1007/s10660-020-09405-4

Download citation

Keywords

  • Coupon marketing
  • e-Coupon
  • Predictive analytics
  • Targeted reminders