Digital and Mobile Coupons Going Viral

Last year Fast Company did a story on an Austin Bagel Company that offered a free bagel to each person that “Liked” their Facebook Page. Within 3 days they had over 330,000 fans, which is a great example of the potential viral publicity and publication that Social Media offers.

Facebook stated, “Einstein’s Bagels” is essentially the first example of a business offering an instant digital coupon for consumers to get something free, although there are probably some people who would contest that. One thing can be sure, Einstein’s Bagels knocked it out of the park with their promotion and intelligently parlayed that into an opportunity to get a great news piece published in a major technology publication. Being from Austin, it’s great to see our city being so well represented in the Social Media landscape by local business.

That said, this raises some interesting logistical questions about the use of digital and mobile coupons and how they can be tracked effectively. Many if not most of the web-based or mobile coupon applications require the coupons to be printed out (which is obviously inconvenient given the ease of carrying a mobile phone), or somehow requires the merchant to validate the coupon/offer at the point-of-sale. Even with the Einstein promotion, it was never made crystal clear how Einstein’s validated the users beyond the statement…they were working directly with Facebook to insure the campaign was successful.

The bottom line is that with a printed coupon or fan status validation, you won’t know who redeemed what, where, and when. You won’t know who your greatest champion is or who your best customers are, which takes away your ability to reward them. Companies like Foursquare, Gowalla, Yelp, and now Facebook are leveraging GPS and other check in features allowing customers to track and publish how often they visit a business. While this might be a workable avenue to develop coupon applications, loyalty programs, and other mobile application development platforms, other questions will arise with apps like Foursquare and Gowalla since they are game-based and require customers to actually use and play those games.

The #1 thing that digital and mobile coupons require is real-time validation and tracking. Stay tuned as a number of products near completion…including one that will not only allow you to tap your users social graph, it will support coupon redemption tracking, track viral coupon distribution by your userbase, drive customer loyalty, and even deliver rewards to your customers. I am betting on the leading applications being web-based and then having mobile compatibility, so they have the ability to be truly viral without any specific platform limitations.