With the upsurge of penny-pinching consumers scouring the internet for discount voucher codes, comes the added industry threat from those entering the market and not playing by the rules.
We caught up with Simon Bird, the general manager of online shopping deals, discounts and voucher codes business, Savoo.co.uk, to get his views on the positive and negative aspects of the UK voucher code market.
Q: Simon, what voucher code of compliance do you adhere to and why is a code of compliance needed?
A: Savoo fully complies with the Interactive Advertising Bureau (IAB) code of conduct. This compliance ensures retailers feel confident in working with voucher code sites.
Q: How would you summarise the voucher code market in the UK?
A: The first thing to mention is that the market is maturing rapidly and is increasingly becoming more sophisticated. But while the voucher code market is growing, it’s not growing as fast as the last few years and that is largely due to the fact that consumers are more used to the idea of the best ways of saving money.
Voucher sites have had to be smart about the way they evolve their businesses and are increasingly becoming destination sites – creating and using more sophisticated methods of driving traffic to create incremental sales.
With that in mind, it’s now more difficult to enter space as a publisher. We think you now need at least £1 million investment to launch a competitive site.
The graph below shows how the voucher market is growing, with 65 million searches in January 2013; which shows that deal-sensitive consumers aren’t going away.
Q: What positive trends have you noticed across the UK voucher code industry?
A: As a member of the IAB, we are pleased to see the successful policing of the industry over the last few years – with the majority of publishers being compliant to IAB rules. This policing allows advertisers to see the benefits of how the channel can work for them and, importantly, helps grow trust in publishers. This trust helps advertisers see more value in sharing tactics and data to optimise performance. To that end, advertisers are becoming more organised with their promotional calendars, sharing this information with affiliates in advance which allows publishers to plan in advance and not work so ad-hoc.
From a network perspective, technology is allowing greater control of how codes are proliferated at certain networks – something that can only be beneficial to the industry.
Q: What negative trends have you noticed across the UK voucher code industry?
A: Publishers from outside of the UK enter the market without acknowledging rules on programmes. Networks and retailers need to police this better (e.g. broad matching on brands, not compliant with the IAB code of conduct). There is a lack of technology used by networks and retailers to prevent exclusive codes given to specific affiliates being used elsewhere.
Speaking broadly, there is a lack of awareness on how some voucher codes sites have evolved their business models to offer new and varied ways of achieving incremental sales or new customers. While we have done a good job on educating the market, there is more to do to show how publishers are growing and diversifying their businesses.