WO2000003361A2

WO2000003361A2 - Method and apparatus for electronically redeeming coupons

Info

Publication number: WO2000003361A2
Application number: PCT/US1999/015303
Authority: WO
Inventors: Craig Muller; Virgil Bistriceanu
Original assignee: Direct Marketing Technology, Inc.
Priority date: 1998-07-08
Filing date: 1999-07-07
Publication date: 2000-01-20
Also published as: WO2000003361A3; AU5091499A; JP2002520721A

Abstract

An apparatus receives a user identification code and a candidate coupon identification code from a client via a communication channel. Subsequently, the apparatus determines if the candidate coupon identification code is associated with a redeemable coupon by consulting a list of redeemable coupon identification codes. The list is a relatively small random subset of the total number of possible coupon identification codes in order to reduce fraud. If the candidate coupon identification code is redeemable, a control circuit awards a predetermined number of incentive points to an account identified by the user identification code. The incentive points may then be used to purchase merchandise or to reduce the price of merchandise from participating merchants.

Description

METHOD AND APPARATUS FOR ELECTRONICALLY REDEEMING COUPONS

TECHNICAL FIELD OF THE INVENTION

The present invention relates in general to electronic

redemption of coupons and in particular to redeeming coupons over a

network by receiving a predetermined coupon identification code and

awarding incentive points.

BACKGROUND OF THE INVENTION

Often merchants want to give customers an incentive to try a

particular product. Typically this is done with coupons. These coupons are

normally removed from periodicals and/or product packaging and redeemed

at the point of purchase in the form of a discount on purchased products.

However, this method suffers from certain drawbacks. First,

the customer must have the coupons handy when the purchase is made in

order to receive the discount. Second, an additional transaction must occur

between the retail store and the wholesaler to complete the transaction.

Third, demographics associated with the customer and the purchase may

not be collected if the customer is not identified. And fourth, there is no

additional opportunity to provide marketing information to the customer. SUMMARY OF THE INVENTION

In accordance with a first aspect of the invention, a method for

electronically redeeming coupons is provided. The method comprises the

step of receiving a candidate coupon identification code. The method

further comprises the step of determining if the candidate coupon

identification code is a predetermined coupon identification code, the

predetermined coupon identification code being associated with a

redeemable status. Still further, the method comprises the step of awarding

incentive points to a user account if the candidate coupon identification

code is the predetermined coupon identification code.

In some preferred embodiments, the step of receiving

comprises receiving a message via the Internet. In other preferred

embodiments, the step of determining comprises comparing a representation

of an alpha-numeric character of the candidate coupon identification code

to a representation of an alpha-numeric character of the predetermined

coupon identification code. In some embodiments, the method further

comprises τhe step of collecting demographic information by associating the

predetermined coupon identification code with a user identification code.

In other embodiments the method further comprises the step of presenting

marketing information by displaying a web page.

In accordance with a further aspect of the present invention,

a method for electronically redeeming coupons is provided. The method

comprises the step of defining a set of valid coupon identification codes. The method further comprises the step of receiving a candidate coupon

identification code. Still further, the method comprises the step of

determining if the candidate coupon identification code is a member of the

set of valid coupon identification codes. Additionally, the method comprises

the step of determining a status associated with the valid coupon

identification code if the candidate coupon identification code is the member

of the set. Further, the method comprises the step of communicating a first

error message if the status is indicative of an expired coupon identification

code. Still further, the method comprises the steps of communicating a

second error message if the status is indicative of a redeemed coupon

identification code, and, awarding incentive points to a user account if the

status is indicative of a redeemable coupon identification code.

In some preferred embodiments, the step of receiving

comprises receiving a message via the Internet. In other preferred

embodiments, the step of determining comprises comparing a representation

of an alpha-numeric character of the candidate coupon identification code

to a representation of an alpha-numeric character of the predetermined

coupon identification code. In some embodiments, the first error message

is substantially equivalent to the second error message.

In certain embodiments, the system further comprises the step

of changing the status to redeemed. In some embodiments, the system

further comprises the steps of receiving a user identification code;

incrementing a counter if the status is indicative of one or more of a group consisting of an expired coupon identification code, a redeemed coupon

identification code, and an invalid coupon identification code; comparing the

counter to a predetermined threshold; and, disabling a user account

associated with the user identification code if the counter exceeds the

predetermined threshold. In such an instance, the predetermined threshold

may vary as a function of time.

In accordance with another aspect of the present invention, an

apparatus for electronic coupon redemption is provided. The apparatus

comprises an account validator in communication with the receiver for

determining if the user identification code is associated with a valid user

account. The system further comprises a redemption validator cooperating

with the account validator for determining if the coupon identification code

is associated with a redeemable coupon. Still further, the system comprises

a point awarder cooperating with the redemption validation for awarding

points when the coupon identification code is associated with a redeemable

coupon. Additionally, the system comprises a point awarder cooperating

with the redemption validation for awarding points when the coupon

identification code is associated with a redeemable coupon. Further, the

system comprises a point awarder cooperating with the redemption

validation for awarding points when the coupon identification code is

associated with a redeemable coupon. Additionally, the system comprises

a memory device in communication with the point awarder and the account

validator for storing the valid user account and the awarded points. Still further, the system comprises a transmitter cooperating with the account

validator, the redemption validator, and the point awarder for transmitting

a message associated with a status of the coupon redemption.

In some preferred embodiments, the apparatus further

comprises a fraud checker in communication with the account validator for

counting a number of coupon identification codes associated with both the

user identification code and a non-redeemable status. In some

embodiments, the message is indicative of points being awarded. In certain

embodiments, the message is indicative of an error condition.

BRIEF DESCRIPTION OF THE DRAWINGS

These and other features and advantages of the present

invention will become more apparent from a detailed consideration of the

following detailed description of certain preferred embodiments when taken

in conjunction with the drawings in which:

FIG. 1 is a block diagram of a typical computer network

capable of utilizing the present invention;

FIG. 2 is a flowchart of a program that can be implemented by

the apparatus of FIG. 1 to electronically redeem coupons;

FIG. 3 is a flowchart of another program that can be

implemented by the apparatus of FIG. 1 to electronically redeem coupons;

FIG. 4 is a block diagram of an apparatus, suitable for use as

the apparatus depicted in FIG 1 ; and, FIG. 5 is a table for storing valid coupon data.

DETAILED DESCRIPTION OF THE PREFERRED EMBODIMENTS

Although the following description focuses on a personal

computer communicating with a server over the Internet in order to

electronically redeem a coupon, persons of ordinary skill in the art will

readily appreciate that the techniques of the present invention are in no way

limited to personal computers communicating with Internet servers. On the

contrary, any system which might benefit from electronic redemption of

coupons may employ the techniques shown herein. Such systems might

include in store terminals and/or any communication channel to the

redeeming apparatus.

An apparatus 10 constructed in accordance with the teachings

of the invention is schematically illustrated in FIG. 1 in a preferred

environment of use. A communication channel 1 2 is shared by the

apparatus 10 and a plurality of clients 14. The communication channel 12

is preferably the Internet, but may be any wired or wireless communication

medium capable of conveying a coupon identification code and a user

identification code. Although a client 14 could take on many forms, such

as a telephone, two-way pager, kiosk, teller machine, etc., in the typical

case for the Internet, the client 1 is implemented as a web browser on a

personal computer. A flowchart of a program that can be implemented by the

apparatus 10 to electronically redeem coupons in accordance with the

teachings of the present invention is illustrated in FIG. 2. The programmed

steps are typically performed by a control circuit such as a microprocessor

as is conventional. Once the program is initiated the control circuit

preferably receives a user identification code (block 20) from a client 14 via

the communication channel 1 2. The user identification code may be any

string uniquely identifying a particular account to which incentive points

may be awarded. For example, the user identification code may be an

account name or an account number. The user identification code may be

entered in a dialog box or a form originating from the apparatus 10 (e.g., a

web page), or, it may be sent automatically by the client 14 (e.g.,

encapsulated in a cookie).

Further, the user identification code may be in the form of a

digital certificate or other digital identification means. A user identification

code may be established when a user visits registration web site and

completes a questionnaire. The questionnaire may be designed to solicit

various demographic data of interest to web site proprietors. For example,

a profile may include a participating user's age, income, occupation, etc.

Once the questionnaire is completed, a profile server sets up an account for

the new user and saves the user's demographic profile and associated user

identification code to a database. Further, the control circuit receives a candidate coupon

identification code (block 22) from the client 14 via the communication

channel 12. Preferably, the candidate coupon identification code is an

alpha-numeric string entered in a dialog box or a form originating from the

apparatus 10 (e.g., a web page). However, the candidate coupon

identification code may be any digital signal entered in any manner (e.g., a

series of ones and zeros entered by a magnetic card reader or a bar code

reader). Coupons containing (e.g., printed on, bar coded, and/or

magnetically coded) valid coupon identification codes may be located

anyplace traditional coupons are located (e.g., in a box of cereal), and, may

be redeemed at any time (not just at the time and place of purchase).

Subsequently, the apparatus 10 determines if the candidate

coupon identification code is redeemable (block 24). In order to make this

determination, the apparatus 10 preferably maintains a list of redeemable

coupon identification codes. Further, the list is preferably a relatively small

random subset of the total number of possible coupon identification codes

in order to reduce the chance of fraud. For example, if the coupon

identification code is sixteen characters long (preferably case sensitive

letters and numbers), then there is approximately 4.76* 10²⁸ possible

coupon identification codes. If the number of coupon identification codes

randomly selected for the list of redeemable coupon identification codes

(i.e., the codes available for coupons) is about 4* 10¹³, the probability of

guessing a redeemable coupon identification code is approximately one in 10¹⁵. In one embodiment, the determination is made by comparing a

representation of an alpha-numeric character of the candidate coupon

identification code to a representation of an alpha-numeric character of the

predetermined coupon identification code. Alternatively, well known digital

signatures may be appended to coupon identification codes for

authentication.

In the event that the candidate coupon identification code is

not redeemable, the control circuit exits the program (block 24). However,

if the candidate coupon identification code is redeemable, the control circuit

awards a predetermined number of incentive points to an account identified

by the user identification code (block 26). The incentive points may then

be used to purchase merchandise or to reduce the price of merchandise

from participating merchants. In some embodiments, the incentive points

may be converted into a cash award. The number of incentive points

awarded is determined using the coupon identification code as a key in a

look up table accessible by the apparatus 10. A more detailed discussion

of incentive points and exemplary uses thereof may be found in U.S. Patent

Application Serial Number 09/080,946 which was filed on May 19^th 1998

and is hereby incorporated by reference.

Once a customer is identified by the user identification code

and a product is identified by the coupon identification code, the coupon

identification code may be associated with a specific demographic profile

associated with the user identification code. Further, additional marketing information may be presented to the user. For example, a particular web

page targeted to this type of customer buying this type of product could be

displayed.

A flowchart of another program that can be implemented by

the apparatus 10 to electronically redeem coupons in accordance with the

teachings of the present invention is illustrated in FIG. 3. Again, the

programmed steps are typically performed by a control circuit such as a

microprocessor as is conventional. Once the program is initiated the control

circuit preferably defines a set of valid coupon identification codes (block

30). Preferably, this is accomplished by randomly generating a relatively

small number of coupon identification codes with a predefined minimum

length. For example, 4* 10¹³ unique coupon identification codes, each

comprising sixteen alpha-numeric characters, could be randomly generated

in a well known manner. Of course, a smaller or larger number of unique

coupon identification codes could be randomly generated.

Subsequently, the control circuit preferably receives a user

identification code (block 32) from a client 14 via the communication

channel 12. As discussed above, the user identification code may be any

string uniquely identifying a particular account to which incentive points

may be awarded. After receiving a user identification code, the control

circuit checks a list of valid user identification codes to determine if the

program should proceed (block 34). If the user identification code is not

valid, the control circuit exits the program. However, if the user identification code is valid (i.e., it is in the list of valid user identification

codes), then the control circuit waits to receive a candidate coupon

identification code (block 36) from the client 14 via the communication

channel 12. As discussed above, the candidate coupon identification code

is preferably an alpha-numeric string entered in a dialog box or a form

originating from the apparatus 10 (e.g., a web page). Of course, it will be

readily appreciated by persons of ordinary skill in the art that the candidate

coupon identification code could be received before the user identification

code without departing from the scope of the invention.

Subsequently, the apparatus 10 determines a status associated

with the candidate coupon identification code (block 38). Exemplary

statuses include redeemable, redeemed, and expired. A redeemable status

indicates that the coupon identification code is valid and is available for

redemption. In other words, a user submitting a coupon identification code

with a redeemable status may be awarded incentive points. A redeemed

status indicates that although the coupon identification is valid (i.e., it is in

the list of valid user identification codes), it has already been redeemed (i.e.,

associated incentive points have already been awarded) and is therefore

unavailable for redemption. An expired status indicates that although the

coupon identification is valid, a predetermined period of time has past, and,

therefore, the coupon is unavailable for redemption.

In order to determine whether the candidate coupon

identification code is valid (block 40) and to determine its status (block 38), the apparatus 10 preferably maintains a list of valid coupon identification

codes and their associated statuses in a memory. As discussed above, the

list is preferably a relatively small random subset of the total number of

possible coupon identification codes in order to reduce the chance of fraud.

If the control circuit determines that the candidate coupon identification

code is invalid (i.e., not in the subset), then a counter associated with the

user identification code is preferably incremented (block 42). If the counter

exceeds a predetermined threshold (ever, or as some function of time e.g.,

five failed attempts in one day), then the account associated with the user

identification code is preferably disabled. Disabling the user's account may

be permanent or temporary. Of course, it will be readily appreciated by

persons of ordinary skill in the art that the step of determining if the

candidate coupon identification code is valid could be performed prior to the

step of determining an associated status without departing from the scope

of the invention.

If the candidate coupon identification code is a valid coupon

identification code, the status associated with the coupon identification

code is tested against one or more predetermined statuses (blocks 44, 50,

and 54). As discussed above, if the status is redeemable (block 44), the

control circuit awards a predetermined number of incentive points to an

account identified by the user identification code (block 46). As before, the

number of incentive points is determined using the coupon identification

code as a key in a look up table accessible by the apparatus 10. Subsequently, the status is preferably changed to redeemed

(block 48) in order to prevent any later redemptions. However, in one

embodiment not employing unique identification codes, the status may be

changed to redeemed only for this user identification code, thereby allowing

other users to redeem the same coupon or another instance of the same

coupon. Similarly, the status may be changed to redeemed only after a

certain number of redemptions or after a certain number of redemptions by

a particular user or after a certain number of redemptions by a particular

user within a particular time frame.

If, when the status is tested (blocks 44, 50, and 54), the status

is redeemed (block 50), the control circuit preferably communicates an error

message to the client 14 that sent the identification codes (block 52). The

error message may be generic (e.g., "an error occurred") or it may be

specific (e.g., "that coupon has already been redeemed"). As with the

occurrence of an invalid coupon identification code, the counter associated

with the user identification code is preferably incremented (block 42), and,

if the counter exceeds the predetermined threshold, then the account

associated with the user identification code is preferably disabled.

Similarly if the status is expired (block 54), the control circuit

preferably communicates an error message to the client 14 that sent the

identification codes (block 56). The error message may be the same error

message discussed above or a different error message. And, as before, the

counter associated with the user identification code is preferably incremented (block 42), and, if the counter exceeds the predetermined

threshold, then the account associated with the user identification code is

preferably disabled.

A block diagram of a device suitable for use as the apparatus

10 is illustrated in FIG. 4. The device comprises a set of coupled circuits,

such as software instructions operating in a microprocessor. Coupon

identification codes and user identification codes arrive over the

communication channel 12 and are captured by a receiver 60 for processing

in a known manner. Coupon identification codes are checked by a

redemption validator 62, and, user identification codes are checked by an

account validator 64-

Preferably, the redemption validator 62 determines if the

coupon identification code is valid by attempting to locate the coupon

identification code in a list of valid coupon identification codes as discussed

above. The list may reside in the redemption validator 62, in a shared

memory device 70, and/or elsewhere. If the coupon identification code is

in the list then it is valid. If the coupon identification code is not in the list

then it is not valid. Alternatively, the redemption validator 62 may

determine if the coupon identification code is valid by attempting to verify

a digital signature associated with the coupon identification code.

Similarly, the account validator 64 determines if the user

identification code is valid by attempting to locate the user identification

code in a list of valid user identification codes as discussed above. The list may reside in the account validator 64, in a shared memory device 70,

and/or elsewhere. If the user identification code is in the list then it is valid.

If the user identification code is not in the list then it is not valid.

Both identification codes are then passed on to a fraud checker

66 and a point awarder 68. If an attempt is made to redeem an invalid

coupon, the account may be disabled by the fraud checker 66. However,

if a valid coupon is redeemed, the point awarder 68 awards a predetermined

number of incentive points to an account identified by the user identification

code. The incentive points may then be used to purchase merchandise or

to reduce the price of merchandise from participating merchants as

discussed above. The points are preferably awarded by increasing a

number in a database. The database may be in the point awarder, in a

shared memory device 70, and/or elsewhere.

Messages may be transmitted via the communication channel

1 2 to the client 14 by a transmitter 72 in a known manner. These

messages may include error messages when an invalid coupon identification

code is received or when a coupon identification code associated with a

certain status is received. Further, messages may include a success

message when incentive points are awarded. The success message may

include the number of points that were awarded and/or other offers from a

merchant.

A table representing a coupon data structure (e.g., look-up

table or database) is illustrated in FIG. 5. Each coupon identification code 80 is associated with a number of incentive points 82 to be awarded upon

redemption. Further, each coupon identification code 80 is associated with

an expiration date 84. When the expiration date is reached, the status 86

is preferably changed to expired. Still further, when a coupon with a

redeemable status 86 is redeemed, a user identification code 88 associated

with the redeeming user is optionally recorded in this data structure and the

status 86 is preferably changed to redeemed.

In summary, persons of ordinary skill in the art will readily

appreciate that a method and apparatus for electronically redeeming

coupons has been provided. Systems implementing the teachings of the

invention can enjoy efficient electronic coupon redemption with increased

demographics collection capabilities and follow up marketing opportunities.

The foregoing description has been presented for the purposes

of illustration and description. It is not intended to be exhaustive or to limit

the invention to the precise form disclosed. Many modifications and

variations are possible in light of the above teachings. It is intended that

the scope of the invention be limited not by this detailed description, but

rather by the claims appended hereto.

Claims

What is Claimed is:

1 . A method for electronically redeeming coupons

comprising the steps of:

receiving a candidate coupon identification code;

determining if the candidate coupon identification code is a

predetermined coupon identification code, the predetermined coupon

identification code being associated with a redeemable status; and,

awarding incentive points to a user account if the candidate

coupon identification code is the predetermined coupon identification code.

2. A method as described in claim 1 , wherein the step of

receiving comprises receiving a message via the Internet.

3. A method as described in claim 1 , wherein the step of

determining comprises comparing a representation of an alpha-numeric

character of the candidate coupon identification code to a representation of

an alpha-numeric character of the predetermined coupon identification code.

4. A method as described in claim 1 , further comprising the

step of associating the predetermined coupon identification code with a

specific demographic profile associated with a user identification code.

5. A method as described in claim 1 , further comprising the

step of presenting marketing information by displaying a web page.

6. A method for electronically redeeming coupons

comprising the steps of:

defining a set of valid coupon identification codes;

receiving a candidate coupon identification code;

determining if the candidate coupon identification code is a

member of the set of valid coupon identification codes;

determining a status associated with the valid coupon

identification code if the candidate coupon identification code is the member

of the set;

communicating a first error message if the status is indicative

of an expired coupon identification code;

communicating a second error message if the status is

indicative of a redeemed coupon identification code; and,

awarding incentive points to a user account if the status is

indicative of a redeemable coupon identification code.

7. A method as described in claim 6, wherein the step of

receiving comprises receiving a message via the Internet.

8. A method as described in claim 6, wherein the step of

determining if the candidate coupon identification code is a member further

comprises comparing a representation of an alpha-numeric character of the

candidate coupon identification code to a representation of an alpha-numeric

character of a member of the set.

9. A method as described in claim 6, wherein the first error

message is substantially equivalent to the second error message.

10. A method as described in claim 6, further comprising the

step of changing the status to redeemed.

1 1 . A method as described in claim 6, further comprising the

steps of:

receiving a user identification code;

incrementing a counter if the status is indicative of one or more

of a group consisting of an expired coupon identification code, a redeemed

coupon identification code, and an invalid coupon identification code;

comparing the counter to a predetermined threshold; and,

disabling a user account associated with the user identification

code if the counter exceeds the predetermined threshold.

1 2. A method as described in claim 1 1 , wherein the

predetermined threshold varies as a function of time.

13. An apparatus for electronic coupon redemption

comprising:

a receiver for receiving a user identification code and a coupon

identification code;

an account validator in communication with the receiver for

determining if the user identification code is associated with a valid user

account;

a redemption validator cooperating with the account validator

for determining if the coupon identification code is associated with a

redeemable coupon;

a point awarder cooperating with the redemption validation for

awarding points when the coupon identification code is associated with a

redeemable coupon;

a memory device in communication with the point awarder and

the account validator for storing the valid user account and the awarded

points; and,

a transmitter cooperating with the account validator, the

redemption validator, and the point awarder for transmitting a message

associated with a status of the coupon redemption.

14. An apparatus as described in claim 13, further

comprising a fraud checker in communication with the account validator for

counting a number of coupon identification codes associated with both the

user identification code and a non-redeemable status.

15. An apparatus as described in claim 13, wherein the

message is indicative of points being awarded.

1 6. An apparatus as described in claim 13, wherein the

message is indicative of an error condition.