Why the Tesco coupon swindle could have been avoided.
Last week a viral trend saw TikTokers taking advantage of what they call the ‘Tesco Method’ to grab hundreds of pounds worth of sweets for free. Tesco say they have rectified the loophole but not before users had filmed themselves at self-checkout tills with trolleys filled with hundreds of Maltesers, Skittles and M&Ms sweets.
The scam originated from a £1 coupon issued by manufacturer Mars as a goodwill gesture to a customer, but once shared on TikTok, followers soon discovered that the coupon could be used repeatedly. The problem arises from there being two barcodes printed on the coupon; one to allow the manufacturer to issue a refund to Tesco, and the other to issue the customer a £1 refund for goodwill. The coupon is only ever intended for single use at a manned checkout, but fraudsters have been taking advantage of this oversight countless times at self-service tills meaning that Tesco will have lost thousands of pounds worth of products.
Tesco eventually resorted to banning the coupons and shutting self-service checkouts. TikTok videos are now showing that the coupon is no longer valid, fortunately. However, the swindle has led to a number of other supermarkets banning coupons whilst an investigation goes on.
What can businesses do to avoid this kind of scam? Our CEO Jeremy Stern has this to say “Coupons are a tried and tested promotional mechanic. They are especially good for gaining trial and repeat as in the mind of a new consumer, they reduce the risk and the price of purchasing a new product that they may not have tried before and hence might not like.
But they have always been fraught with risk – either at the printing stage, or at the redemption stage with coupons often being redeemed for products other than the intended one, and till service not bothering to stop it. But digital coupons represent a new threat, that of unlimited passing on. If the coupon is simply a number or an image, then there is little to stop it being passed around on social media and used multiple times.
PromoVeritas were once called in to investigate how an email to 2,000 whisky drinkers with a £2 coupon, ended up costing the client over £100,000 in redemption, instead of the maximum £4,000 (2,000 x £2) that they had anticipated, The answer was simple – massive abuse. We found one store in Derbyshire where the manager had put through the same coupon thousands of times.
Fortunately, times have moved on and brand managers have a choice of more sophisticated coupon options, usually with built in safeguards. So, this instance of abuse is more likely to be down to ignorance or lack of care on the part of those setting up the coupon campaign.
At PromoVeritas we use a clever technology that makes it impossible to photograph and copy the coupon or to forward it to others and offers fast tracking via store Epos system. The days of the coupon are not dead, they are simply evolving and getting more clever – brands need to do the same.