April 23, 2003, 12:00 AM

Some CPG manufacturers fear abuse, but consumers love online coupons

38% of U.S. households use web coupons, Forrester says. Technology eases manufacturers’ concerns with new tools to beat coupon fraud.

Kurt Peters

Executive Editor

Though some 38% of U.S. households use coupons downloaded from the web, manufacturers of consumer packaged goods are ambivalent about their value, at least in part because of concerns over coupon fraud, according to findings from Forrester Research Inc. But believing that online coupons are at higher risk of fraud than printed coupons is a misconception on manufacturers’ part, in view of recent developments in technology and online security, Forrester says.

“Responding to fears of consumer abuse, technology providers now employ sophisticated methods of thwarting fraud,” according to Forrester. Examples include coupon site E-centives, which has a downloadable plug-in that communicates with an offsite server to limit the number of coupons printed per PC. Server-based rules mean consumers can’t get around the system by erasing cookies or other identifiers that reside on PCs, Forrester adds.

Some CPG marketers have taken steps to deter even costlier potential coupon abuse at the retailer level by putting unique codes on Internet coupons to trace redemption to individual stores. Forrester says others, such as Procter & Gamble, minimize online coupon fraud risk by splitting coupon requests and coupon fulfillment, letting customers sign up on the web to receive coupons, but then delivering the coupons requested online in the mail as paper coupons.

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