In direct mail, the rifle is replacing the shotgun.

It is no longer enough to point and shoot, marketers have to aim.

Same thing with coupons.

It is no longer enough to dish them out left and right and hope they end up in the hands of a loyal customer, who should be rewarded, or a potential customer who is willing to try your product. They must be targetted.

That is where Catalina Marketing’s Checkout Coupon comes in. For as Catalina brags in its press material, ‘Right on Target! You Can’t Get Closer.’

Product code

By scanning the universal product code found on virtually all items in supermarkets these days, Catalina’s computer is triggered automatically to issue a thermal-printed Checkout Coupon for that brand, a complementary product, or a competitor’s brand.

James Luck, vice-president of sales at Toronto-based Catalina, says his company’s system can be configured to reward or persuade a customer according to the manufacturer’s marketing strategy.

Luck says Catalina’s Checkout Coupon systems are installed in 800 food stores across the country, handling 8.5 million transactions a week representing food sales worth $200 million.

‘There is no other vehicle like this in Canada,’ he says.

Luck says Catalina’s first Checkout Coupon customer was Ontario’s Loblaw’s supermarket chain five years ago. The technology began in California.

Redemption rates for Checkout Coupons run from 7% and up issued against competing firms, to 15% and up for coupons issued by Catalina clients for another product in their lineup.

According to Catalina, there are a number of ways marketing objectives can be identified and met using Checkout Coupons.

Among them are trial, retrial, continuity, trial and bounce-back and pantry loading.

For new product introductions, Catalina suggests using its system to put high-value coupons into the hands of users of competing products.

For retrial, during a product’s new formula change, Catalina further suggests a medium-value coupon.

Last year, according to the Canadian Council of Grocery Distributors, the average value of a food store coupon was 58 cents.

Catalina says for customers already buying a client’s product, continuity can be maintained by offering them low-value coupons.

For trial and bounce-back, Catalina recommends a scheme which combines high-value trial coupons for competing brand buyers to encourage that all-important first purchase, and low-value bounce-back coupons to generate continual buying.

As for pantry loading, Catalina says high-value coupons are effective in selling multiple units of an item.

Luck points to the purchase of cans of cat food as a case in point.

He says if a customer buys five cans of cat food, the manufacturer might offer a discount coupon on the next 10 cans to get the customer to commit to buying more.

The cost of Checkout Coupon depends on the number and type of coupon printed.

To print coupons for distribution to competing users costs 10 cents a coupon. To print coupons for distribution to a client’s own users or cross-category purchasers costs five cents a coupon.

National reservations on Catalina’s Checkout Coupon system can be placed up to 52 weeks in advance. The reservation is good for up to four weeks.

Regional reservations can be made up to six months ahead and will be in effect for up to five business days.