Introduction

RevTrax often receives and answers requests for proposals (RFP) from consumer package goods companies looking for a digital coupon provider. The irony? We dedicate an extraordinary amount of manpower to each RFP, but they are too often evaluated based on the limitations and experiences of working with legacy digital coupon platforms, and do not consider the advances in both customer engagement and digital incentive technology. Certainly, historical experience is the foundation for formulating future action, yet it often neglects evaluation of alternative, more effective solutions in the marketplace. Quite simply, overreliance on the past often inhibits forward-thinking decision-making, which results in perpetuating the status quo instead of innovation.

Open Mindedness

The rapidly evolving marketing and advertising technology landscape means that there are many new technical innovations that can propel promotional marketing efforts to the next level, resulting in a paradigm change. Therefore, critically important in preparing for a new RFP is an organization’s ability to ‘open its mind’ and be willing to explore new solutions providers that can be more effective in helping brands achieve their strategic business and sales objectives, not just their tactical coupon execution needs. Strategy and execution are indelibly linked and both are incredibly important. This white paper presents a best practice guide for modeling digital coupon RFPs to ensure they properly capture, and permit the evaluation of, the broadest range of market capabilities that can serve a variety of marketing interests and ultimately build business.

Institutional Barriers

A common issue, in the development of effective digital promotion RFP’s, is that the power-users of the solution often provide only tangential input into the crafting of the RFP and they have only limited control over the evaluation process. Increasingly, the process is driven by procurement functions in an understandable attempt to standardize requirements. Marketing functions have the broadest access to market intelligence, and the actionable insights, so they are best positioned to articulate business goals, marketing strategies and implementation guidelines as well as associated ‘pain points’. Unfortunately, many marketing professionals are time-constrained and simply do not have the capacity to guide the RFP process, and it is delegated to procurement. Often, the information library and knowledge base that procurement has on technological advancements and solutions providers is woefully insufficient and is limited to experience with their current provider or outdated capabilities presentations from prior years. Therefore it is essential for a successful RFP process that a key business team member be assigned to present and enforce that the digital promotions team’s strategic goals and needs are being incorporated into both the written RFP and the evaluation process.

Strategic Framework

The first step in preparing the RFP is for the marketing function should define the strategic objectives for digital coupons within the marketing mix; mass distribution, personalized engagement or both. A key decision point is to determine whether the organization seeks a single provider or would consider multiple providers. Many digital coupon vendors claim an ability to ‘solve every problem’ yet reality suggests otherwise – each solutions provider typically excels within a certain format but delivers lackluster performance in the others. For example, mass coupon distribution networks specialize in delivering anonymous incentives to large audiences but are ineffective in delivering targeted and personalized digital promotions, an increasingly important priority for marketers.

Each organization needs to assess the business value of working a single vendor or multiple providers against available resources. One simple method is to examine the percentage of digital coupons allocated to mass distribution (scale and reach) versus targeted and personalized solutions. Some marketers will dedicate the majority of their digital coupon budgets to mass distribution while other marketers will allocate the majority against 1:1 solutions, leveraging their owned and paid media programs. As a rule-of-thumb, consumer packaged goods companies that allocate over 25% of their coupon budgets against 1:1 promotion marketing, via owned or paid media, should seek a best in class solution provider for targeted and personalized promotions.

Practical Vetting Criteria

A standard digital coupon RFP will query the potential solutions provider on basic skills and capabilities. For example, when mass distribution is a key goal, the solution providers are routinely asked about absolute shopper reach in terms of monthly website visitors or mobile application downloads, both key predictors that drive mass scale and reach distribution for coupons. Another common, delivery oriented query is whether the solutions provider can support multiple coupon formats such as print at home only (PAH), load to card only (L2C), or both. Last, solutions providers are requested to provide a list of their retailer relationships, a key insight into determining whether the solutions provider has access to retailer websites that enable broader distribution.

Our experience suggests that most RFP proposals end here, even if one of the key goals is 1:1 personalization, and that’s truly unfortunate. The typical RFP is singularly focused on the solutions provider’s ability to drive coupon volume and sales for a specific brand. We believe this narrow approach ignores the many more fundamental value propositions that could be derived from an effective digital coupons platform. From a process perspective, the mass scale and reach questions are much simpler to answer versus the targeted 1:1 promotions solution with a more complex value proposition, but ease of response shouldn’t drive the design of the RFP.

Ideal Questions

For clarification, I have listed actual RFP questions from clients who crafted an informative RFP, formalized the selection process and chose the right digital coupon partner. A best in class digital coupon RFP is typically divided into two principal sections. The first section is focused on the tactical objectives – mass scale and reach – and how that distribution occurs. Each question skews towards the absolute scale distribution levels, broad website coverage and the traffic driving tools employed by the solution provider to move volume. The following questions are straightforward:

1. How many unique shoppers print at home or load to card at least one coupon per month?
2. Please list the digital coupon distribution properties where our coupons will be displayed.
3. Can we specify the website property where we want our coupons to be distributed?
4. How long will take to distribute 500K print at home coupons for a single brand or category?
5. What percentage of the 500K coupons should we expect to come from your primary website property?
6. Do you support load to card, print at home, or both?
7. Can we distribute print at home and/or load to card coupons through your platform on retailer websites?
8. Please list your retailer relationships that will support our website distribution.
9. What percentage of your traffic is desktop, mobile and tablet?
10. Do you have a mobile application? How many active users do you have? How do you define active user?

The second section is more nuanced and focuses on the solution provider’s ability to assist marketers integrate digital coupons into their ecosystems. These queries identify real technological capabilities, actual user experiences (power-user and consumer), client service support and proprietary data access for audience segmentation, shopper retargeting and actionable insights. The following questions represent issues that should resonate with all marketers that strive to optimize digital marketing efforts and leverage ‘smart coupons’.

Integration Process & Value Proposition

1. Please define your process and approach to working with a new client.
2. What actionable insights would we be able to extract from our digital promotions campaigns?
3. How can your proprietary platform data help optimize our campaigns?
4. Explain your plan to integrate your platform across all our marketing and shopper engagement platforms.
5. What data technology partners have you integrated with to streamline onboarding?
6. How does your platform support customer acquisition, grow household penetration and encourage new product trial?
7. Does your platform drive continuity of purchase, brand switching and cross-sell opportunities?
8. What paid and owned media channels do you support?
9. What service levels will you provide to support our business?
10. How will you quantify the business value we are getting from your platform?

Incentive Platform & Product Features

1. Can you please provide an example of standardized and customized reports?
2. Do you have a self-service option for creating, implementing and tracking digital coupon campaigns?
3. Is targeted 1:1 personalization a core capability, and can you share best-in-class use-cases?
4. Can your platform help us with multivariate coupon offer testing?
5. How do you measure and optimize the impact of paid media on in-store sales?
6. How does your social sharing feature work and can it integrate with our social influencer programs?
7. How does your survey functionality work?

Competitive Pricing & Overall Investment

1. Can you provide your annual subscription and individual transaction fees?
2. How does your unique selling proposition that differ from other solution providers?
3. What performance guarantees can you provide?

New Paradigm

Clear answers for each of these questions are important for marketers making crucial decisions on digital coupon providers. Specifically, the answers will help marketers ascertain whether the digital coupon provider is truly able to execute both the mass distribution and targeted 1:1 personalization needs of the business. Only the brand, shopper, promotions, CRM and social teams can really determine whether a strategy-oriented 1:1 digital coupons platform or execution-oriented mass distribution program is ultimately right for the business.

Move Forward

Marketers need to reorient themselves and ask more questions that provide detailed answers against the evolving needs of their businesses as well as new developments in digital coupon technology. Marketers need to go further and evaluate the real business value of their promotions, measure shopper purchase behavior by retailer and employ offer testing and other optimization tools improve performance. Our experience suggests that this forward-looking orientation is a change in mindset, as most marketers have not considered these issues in the past. If the overall goal is to help marketers spend their marketing and promotion dollars more wisely, it makes smart business sense to explore partnerships with best-in-class digital coupons providers who specialize in solving tomorrow’s challenges, today.

About the Author

JONATHAN TREIBER

Chief Executive Officer & Co-Founder

Jonathan has passionately championed ‘all things RevTrax’ since co-founding the company in 2008. With the heart of an entrepreneur, and the soul of a businessman, Jonathan has guided the company throughout its developmental stages from product idea and market introduction through capital investment and revenue growth. As CEO, Jonathan manages an executive leadership team of seasoned professionals with proven business building credentials and impeccable academic pedigrees. Complementing his official role, Jonathan is RevTrax’s Chief Evangelist, Chief Storyteller and Chief Motivator. Prior to RevTrax, Jonathan worked within Citigroup’s Investment Banking Practice. He holds a Bachelor of Arts in Economics, with distinction, from Cornell University.