At our recent conference on electronic coupon clearing, I reviewed some basics of coupon coding. After the explanations of family codes, I made the point -- loud and clear -- that if manufacturers change family codes, the most important thing they should do is alert the retailers.
Everyone agreed this was a good idea, of course, but manufacturers in the audience said, "I thought we weren't allowed to change family codes. Are you saying we can?"
Well, not that I'm the authority on what manufacturers are and are not allowed to do related to codes, but yes, I am saying you can. For those who don't understand what a family code is, it is the three-digit code that is part of a coupon scanning code (number system "5") that allows the scanning systems to validate that specific products have been purchased. It has been a long-standing rule with enlightened technical people that technology should never inhibit good marketing and merchandising strategies. There are two problems with this family code situation, however. Retailers (and manufacturers) can lose a lot of money if the wrong products are validated, and retailers (and manufacturers) can lose whole customers, which are really worth a lot of money. These losses can happen if family code changes are made and not communicated properly, or if there are coupons in the distribution system that will validate the wrong products or not validate for the right products. However, it is sometimes necessary for manufacturers to change family codes. Sometimes the codes as assigned don't make sense. For example, if they weren't set up correctly to begin with. Sometimes promotion strategies change -- from couponing by brand to couponing by size or flavor. Sometimes manufacturers acquire or merge with another company and decide to combine product lines and therefore align the couponing strategies of the two companies. It's not recommended or encouraged, of course, but if the manufacturer really feels it's important to make a change, please follow this advice:
Talk to a few leading retailers who (a) are scanning coupons at the family code level, and (b) have a dedicated coupon scanning coordinator who really understands the couponing systems. Get (and take) their advice, if possible.
Provide the new family code information to your sales representative to be given to the buyers at the retailers and wholesalers. Make sure your representatives understand what a family code is, and that they understand how to communicate that to the distributor's buyer (who may not know what it is).
Alert all retailers you know that are scanning coupons as a separate (additional) effort, if you have a list. If you don't have a list, try to get one. The Food Marketing Institute has some of this information, as does Information Resources Inc.
Notify IRI -- currently the only central source for these codes -- which will alert the retailers that use their file. (Call Jane Michels at (312) 726-1221.)
Do all these things, in advance, as long as possible "before" actually printing the codes on coupons. With the current expiration date average of 3.1 months, it shouldn't be too difficult to comply with this timing.
