How Promo Codes and Mobile Coupons Can Help Combat Coupon Fraud

The following is a guest post by Kathryn Vercillo.

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A quick scan through the recent headlines for news about coupons will reveal that there have been a number of problems related to printable coupon fraud recently. In addition to these problems, there have been problems with excessive printing of downloaded coupons which have caused havoc at various stores (the KFC coupon situation being the most notable case). These issues have created financial losses for many businesses. Perhaps what we’re going to find is that printable coupons will soon be a thing of the past as they get replaced with more modern coupons that are less likely to inspire these problems. The manufacturing and use of both online promotional codes and mobile coupons are growing rapidly which may be a way to help combat Internet coupon fraud.

General Problems with Internet Coupon Fraud

There are many different types of Internet coupon fraud that exist. The most common types of coupon fraud that exist are:

• Coupon fraudster use computer technology to manipulate the barcodes on their coupons. They change the barcode so that they get more money back than they are supposed to get.
• Websites create fake coupons and post them. Innocent customers then download the coupons and try to use them at the stores that they belong to. Cashiers may be confused by the coupons and go ahead and redeem them even though they are not legitimate coupons.
• Photocopying of legal coupons. Downloadable coupons intended only for members of certain clubs or people who have purchased certain items may be printed out and then photocopied.

This fraud costs manufacturers and store owners millions of dollars each year. As a result of this, a number of stores have decided to no longer honor coupons printed from the Internet. Many other stores seem to be leaning in that direction.

Coupon Codes and Mobile Coupons Could be the Solution

One solution to the problem of coupon fraud could be to get away from the use of printable coupons. There are two core technologies that are making this possible today. The first, and currently the more popular of the two, is the use of online promotional codes for getting discounts when shopping online. The second, and perhaps the one likely to see more growth, is the developing use of mobile coupons. Both types of technologies may offer a way for consumers to get discounts on their purchases without putting companies at so much risk of coupon fraud.

The general problems of Internet coupon fraud simply don’t exist with coupon codes and mobile coupons. That’s because those problems are all related to the manipulation of a printed coupon. With promo codes and mobile coupons, there simply isn’t anything to print out. It is a lot more difficult to manipulate the barcode on a mobile coupon (which is a coupon scanned directly on your mobile phone) or to make any functional changes to the promo code of a website.

There is also considerably less room for human error when it comes to redeeming coupon codes and mobile coupons. With discount codes, either the code works when it’s entered into the computer or it doesn’t. With mobile coupons, the coupon is entered through the mobile phone so it isn’t redeemed directly by a cashier. This means that a lot of the coupon fraud that currently relies on benefiting from the confusion of cashiers is simply not going to exist when redeeming promo codes and mobile coupons.

Will This End Coupon Fraud?

Switching over from printable coupons to these new forms of non-printable coupons is likely to reduce or eliminate coupon fraud as we know it. However, there are always going to be criminals that find new ways of committing fraud so it’s unlikely that coupon fraud will be terminated completely even if we all make a total switch to using non-printable coupons. Despite this, there are some reasons why non-printable coupons are going to be safer in terms of fraud risk than are their printable counterparts:

• Initially it will be more difficult for coupon fraudsters to manipulate these types of non-printable coupons. It’s fairly easy to learn to photocopy and manipulate a printable coupon or to create a fake coupon but it’s going to be more difficult for criminals to figure out how to manipulate or create usable coupon codes.
• Moreover, it is likely that coupons based on modern technology will change more rapidly than general Internet coupons which will cause fraudsters to have to continually stay on top of their game in adapting their scams to the new types of coupons that are being created.
• It will be easier to catch people that are using fraudulent coupons. There is going to be a considerably stronger link to these people because of the fact that the coupons are used online or through phones which can both be tracked. Additionally, the purchased items will be paid for with a credit card, online banking system or mobile payment method which will be easy to track. This is not the case with a printed coupon that is taken to a store where the item purchased is paid for in cash.

This should all mean that there will be an overall reduction in losses due to coupon fraud even though some level of coupon fraud will continue to exist.

Kathryn is a writer for Promotionalcodes.org.uk which gives away free discount deals (like this Debenhams promotional code) and also publishes money saving tips.