coupon that entitles the bearer to a discount on an item at the time of purchase. The coupon is given by the buyer to the retailer, who submits it to the manufacturer, wholesaler, or clearinghouse for reimbursement. Some retailers offer their own "store" coupons and assume the cost of the discount themselves in order to bring more customers into the store. Coupons are used to entice consumers to try new products, to increase the frequency with which they purchase a product, to increase the quantity they purchase at any one time, or to persuade them to buy a brand other than the one they usually buy. Some coupons employ an expiration date or minimum purchase quantity requirement to ensure the coupon issuer's objectives are met. Coupons are distributed via mail, in newspaper and magazine inserts, and in newspaper and magazine space advertisements. The coupon should be designed to stand out prominently from the rest of the advertisement with a bold outline or different background color. Some are found in or on packages, and these are redeemable either for a repurchase of the same product or for the purchase of a companion product (for example, a coupon for a cheese spread enclosed with a package of crackers). The latter practice is called cross-couponing.
It is estimated that approximately 150 billion coupons are distributed annually. However, only a small percentage of them are actually redeemed. The highest rate of redemption is from those offered in or on packages, since people who have already purchased a product are likely to repurchase.
