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Couponing fuels supermarket mobile apps

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Published:   |   Updated: March 20, 2013 at 05:56 PM
TAMPA -

Will grocery shoppers casually scan a jar of peanut butter with their smart phone to find an online coupon?

Or will they use their smart phones to organize a strict shopping list and avoid splurging on an impulse purchases.

Those are suddenly billion-dollar questions in the grocery industry.

The opportunity to do something – anything – that combines the raging fad of couponing with Americans' love of cell phones has quickly triggered a rush of action and competition in the normally sleepy grocery market.

On one side are start-up companies like ShopSavvy, which had huge success with bar-code scanning to help people save money on electronics and clothes.

On the other side are grocery stores themselves like Target, Walmart and Publix, each hoping shoppers will use their store-brand apps instead, and spend more money in the aisles.

Regular people using mobile phones in the grocery aisles may seem like an outlandish idea, said Al Ferarra, director of retail services at accounting and consulting firm BDO, but not long ago, so did the idea of using a mobile phone screen for an airline ticket.

"Every day, people at airports show their phones to TSA agents to get on planes – It's normal," Ferarra said. "There's no question that supermarkets, and their suppliers, are going to start something in mobile."

ShopSavvy

The first companies to rush into mobile grocery tools were the start-ups.

More than 20 million people have already downloaded the ShopSavvy app for their iPhones and Droid phones – mainly to scan hard goods and apparel like televisions or shoes to find the best price online.

Now ShopSavvy is getting into grocery in a big way, and has cut deals with Walmart, Whole Foods, Rite-Aid, Safeway and others to gather their price data on products.

ShopSavvy officials envision two scenarios: Grocery shoppers scanning a jar of peanut butter to find coupons, or shoppers using the Web version at home to build a shopping list they use on their phones.

Saving 25 cents on peanut butter "may seem like a small amount," said John Boyd, co-founder of ShopSavvy. "But put together, it all adds up."

Here are some the players in the grocery app industry and their strategies.

Coupons.com

Coupons.com is already the largest online coupon site in the world, and the company has big plans for mobile too, though in a different scenario.

"We think that by the time you're in the store, it's probably a bit too late to present a coupon on your phone to show the cashier," said Dhana Pawar, director of mobile products at Coupons.com.

But there are opportunities, she said, as the company's GroceryiQ web-based service lets users sift through products, discover coupons, and add those coupons to their store loyalty card. "That makes a lot more sense for a user at the register."

There are also opportunities in newer cell phones that will have discrete "push" notifications that could feed deals into people's phones unobtrusively, she said.

Consmr

The start-up company Consmr takes the philosophy that people may have strong opinions about food and lets people rate any item just as they would a movie or restaurant.

Backed with executives with the online site for Zagat, Consmr already has more than 50,000 ratings on things like Oreos, Claussen pickles, Nutella spread and Special K cereal.

"Ours is like an Angie's List or Yelp for the supermarket," said chief executive Ryan Charles. "And when you scan an item, you can see if it's truly gluten-free, organic, or good for your skin."

Soon, the company hopes to add live coupons, so people who rate an item may discover a deal to go buy some.

Grocers

Seeing a similar opportunity in mobile, grocery stores are getting into the mix too, but under their own terms.

Winn-Dixie this year launched a mobile app that lets users look up the weekly deal flier and build shopping lists that are organized based on aisles in their particular stores.

Publix launched a mobile web page this year with basic information like the nearest store and the weekly circular, and will add other functions this autumn, said spokeswoman Shannon Patten.

Both Target and Walmart have added grocery items to their mobile apps so users can see live inventory data about which store nearby has items in stock and read customer reviews.

For instance, "gauge58" wrote a review claiming that the 16-ounce Walmart Marketside Roasted Garlic Artisan Loaf bread may be the best he's ever eaten, but won't say for sure "so as not to slight Grandma!!"

Target has started issuing its own store-brand mobile coupons for people who sign up online, but Target also took more control of mobile couponing by requiring any mobile ecoupon have a scanable bar code – not just a discount price displayed on a screen.

Whether or not any of this takes off as a popular trend remains a mystery, said Ferarra of BDO.

Mobile scanning apps make huge sense when the shopper is comparing one high-priced item, like a HDTV, and wants to know if Walmart or BestBuy has a better price.

A cart-full of groceries is another matter, he said.

"Let's assume a woman has 35 coupons stuck somewhere on her phone," Ferarra said. "She's in the checkout line sorting through them, then her boss calls, then she's sorting again. One thing supermarkets hate for sure is having a long checkout line."


rmullins@tampatrib.com (813) 259-7919 Twitter: @DailyDeadline

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