Millions learn the art of coupon clicking

By , Contributor to The Christian Science Monitor

Twenty percent off, $15 off your next purchase of $75 or more, buy 10 bagels, get a free pound of coffee!

Anyone with a mailbox probably has received countless coupon offers like these. But for online shoppers, an e-mail in-box doesn't necessarily provide the same perks and privileges.

Internet merchants offering coupon deals often sport a space on their online order forms to enter promotional codes. But to obtain this special sequence of numbers, consumers must often register at the site, providing personal information.

Recommended: Are you a smart shopper? Take our quiz.

But a growing trend in online retailing is clearing the hurdles to hot deals, in the form of websites that specialize in coupon codes. These websites collect offers from thousands of retailers, presenting them as a one-stop shop for bargain hunters.

Coupon-code sites attracted almost 167 million unique users last month, according to comScore Networks, an Internet research firm in Chicago.

A lot of consumers get very attached to shopping this way, says Christian Gordun, founder of CouponCraze.com, a site that contains about 1,000 deals. "They won't even make a purchase unless they get a coupon."

A wide range of deals

Though some sites focus on specific areas, online shoppers can find coupons for everything from computers to cauliflower.

Convenience and variety draw people to coupon sites, says Kurt Lohse, founder of Keycode.com, a site that specializes in promotional codes. "It's hard for a shopper to go out to 10 or 15 of their favorite retailer sites when they have a need for a new outfit, but if you check our site, you can see them all at once," he claims.

The ease of comparison- shopping depends in large part on the navigability of these sites. Some are cluttered with ads, making it difficult to distinguish between them and discount offers. Worse, some coupon sites let anyone post offers, without any form of verification.

Elements of fraud

When a coupon's source is not clear, a danger of fraud exists, warns Bud Miller, director of the Coupon Information Center, a service in Alexandria, Va. that fights coupon misredemption. Counterfeit coupons are as illegal as counterfeit money, he says. "A lot of good consumers out there are being duped by this.... There was even a [news report on a] TV station in Texas that used a counterfeit coupon as an example of what a good coupon should look like."

For that reason, many coupon sites take special care to screen and monitor their content. Coupons.com, which offers hundreds of promotional codes as well as printable coupons for use at stores, requires users to download special coupon-printing software. It applies unique identifying security information to each coupon printed and limits the number of coupons that can be printed from any given computer.

These measures help safeguard against coupon duplication and ensure that the coupons will scan at the register, says Steven Boal, Coupons.com's chief executive. "The only real potential [problem] is coupon pass-along" from consumer to consumer.

While sharing coupons is a breach of the contractual terms between Coupons.com and its users, it's not a crime like counterfeiting, Mr. Boal says.

Internet coupon companies arrange their offers in different ways. Some target younger and more affluent consumers that normally shop online. Many sites list deals in alphabetical order or by coupon expiration date. Keycode.com ranks offers according to the perceived value each one might present to a consumer as well as the potential for profit.

After all, coupon-code sites need commissions to survive. Depending on the manufacturer's profit margin for a particular product, commission rates can be anywhere from 2 percent to 20 percent of the sale price, says Richard Booth, president of Findsavings.com. "Sometimes a merchant also says 'I'll give you X increase if you feature me.' ... But most merchants have a standard commission structure," he says.

Printable coupons bring in a flat fee, ranging anywhere from 5 to 50 cents. Those amounts are worth it to coupon sites like Boodle.com, which specializes in grocery store coupons. "There is about a 15 percent redemption rate on coupons printed online - that's very high compared to [Sunday newspaper coupons], which average about 1 percent." says Terry Shirley, Boodle.com's vice president of sales.

Online coupons can be far more accurate than newspaper coupons, Boal adds, because merchants can change offers in real time. "In the offline world, printing and distribution takes months and months of scheduling," he says. "In the online world, they can change coupons in five minutes."

The top five coupon sites

ComScore Networks ranks the Internet's most popular sites for penny-saving promotions. Here's our two cents on the five most-visited sites from the past year:

1. CoolSavings.com - It's colorful, well organized, and has good sorting functions. And who doesn't love a mascot piggy bank in cool shades? An extensive registration, however, means consumers who don't want to provide their home address may want to look elsewhere.

2. Eversave.com - Presentation is geared for the mature shopper; good category breakdown, but you can expect to do a little sifting through other offers to find the actual coupons.

3. Coupons.com - Browsing is fun here, especially when you stop to watch the video coupons. But those without a newer operating system to support the special Coupon Printer are out of luck.

4. CouponMountain.com - Efficient site for the efficient shopper; all specialized searches have clear links right on the homepage.

5. Valpak.com - Name sound familiar? These guys have been making traditional mailbox deliveries for years. ValPak does include printable coupons, and offers deals for restaurants and entertainment along with consumer goods.

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