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In marketing, a coupon is a ticket or document that can be exchanged for a financial discount or rebate when purchasing a product.
Customarily, coupons are issued by manufacturers of consumer packaged goods or by retailers, to be used in retail stores as a part of sales promotions. They are often widely distributed through mail, coupon envelopes, magazines, newspapers, the Internet (social media, email newsletter), directly from the retailer, and mobile devices such as cell phones. Since only price conscious consumers are likely to spend the time to claim the savings, coupons function as a form of price discrimination, enabling retailers to offer a lower price only to those consumers who would otherwise go elsewhere. In addition, coupons can also be targeted selectively to regional markets in which price competition is great.
In 1887 the Coca-Cola Company was incorporated in Atlanta, Georgia, with Asa Candler as one of the partners. He transformed Coca-Cola from an insignificant tonic into a profitable business by using innovative advertising techniques. The key to this growth was Candler’s ingenious marketing including having the company’s employees and sales representatives distribute complimentary coupons for Coca-Cola. Coupons were mailed to potential customers and placed in magazines. The company gave soda fountainsfree syrup to cover the costs of the free drinks. It is estimated that between 1894 and 1913 one in nine Americans had received a free Coca-Cola, for a total of 8,500,000 free drinks. By 1895 Candler announced to shareholders that Coca-Cola was served in every state in the United States.
In Australia consumers first came in contact with couponing when a company called Shop A Docket promoted offers and discounts on the back of shopping receipts in 1986.
Coupons first saw widespread use in the United States in 1909 when C. W. Post conceived the idea to help sell breakfast cereals and other products. Today, more than 2,800 consumer packaged goods companies offer coupons for discounts on products. In 2011 U.S. consumers used coupons to save 4.6 billion dollars on their purchases of consumer packaged goods