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CNBC has a story suggesting that if Amazon's $13.7 billion bid to acquire Whole Foods goes through, it could be "the beginning of the end" for the traditional coupon business.

The story essentially posits that if Amazon is true to form, it is likely to lower prices at Whole Foods, which in turn will force more traditional chains to lower their prices as well. The point seems to be that an Amazon-Whole Foods could propel the entire retail food industry in an Every Day Low Price (EDLP) direction.

If retailers are pushing "guaranteed low prices" and technology enables shoppers to easily compare prices, traditional coupons - especially those offered via a freestanding insert (FSI) in a newspaper - become less relevant to consumers and therefore less attractive to marketers.

And then, CNBC writes, one has to put that in the context of broader, already-existing trends: "Couponing has already been on a steady decline as the economy improved following the Great Recession. Overall coupon redemption fell more than 4 percent in 2016 from 2015, while the average face value for coupons as well as the total volume of offers were lower in 2016, according to Inmar, a leading coupon processor. Last year was also the first time ever that digital coupons surpassed traditional paper coupons in popularity, Inmar reported."
KC's View:
It probably is a mistake to take an absolutist view of this stuff. Just because Amazon buys Whole Foods - a retailer that was not exactly the world's biggest issuer of coupons - doesn't mean that the entire coupon business is going to collapse.

To me, the bigger threat to the traditional coupon business always has been the ability to use technology to target consumers specifically, eliminating the need for things like FSIs and broad, indiscriminate coupon distribution. I've used this example here before, and I'm sticking with it - any system that sends me a cat food coupon is one that has outlived its usefulness.

At the same time, though, it does seem possible that there could be a general move by the industry toward EDLP, though I think at best it would be a hybrid version that also would use targeted promotions.