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THOUGHT LEADERSHIP

What to Expect from Neptune + Quotient Merger

29 Jun 2023

By Julie Argonis, The Mars Agency

Last week’s announcement that marketing services company Neptune Retail Solutions will acquire Coupons.com parent Quotient Technology sent a bit of a shockwave through the industry.

The merger unites Quotient’s innovative technology platform, extensive digital promotions network, and proprietary data with Neptune’s broad network of retail solutions and deep shopper insights across in-store and print media. The following article summarizes The Mars Agency’s perspective on what the combined entity could bring for brands.

1. Business as usual, for now. The transaction is expected to close in the second half of 2023, and it will be several months before all the details are worked out. Until then, Neptune and Quotient will continue operating as independent companies, and we don’t expect any immediate impact on operations or disruption to current or planned programs.

2. Redundancies will be sorted out and new capabilities will emerge. Currently, there are considerable capabilities overlaps and even some competitive similarities. We can reasonably expect that redundancies will be evaluated and eliminated while notable improvements and complementary enhancements from similar platforms will be integrated into upgraded offerings.

For example, Quotient’s Shopmium app and Neptune’s Checkout 51 will likely merge into a single source of receipt-verified rebates. Quotient’s DOOH (digital out of home) demand-side and self-serve platform could be integrated into Neptune’s offering, maximizing data, targeting, measurement and reporting.

The fate of Quotient’s partnerships with Microsoft Bing, the Amazon Alexa app and other parties is unknown, but precarious. (The industry has been skeptical about the value of those scale distribution propositions since they were first announced.)

3. Neptune will likely bring Quotient-managed retail media networks into the fold, but existing retail and consumer promotion divisions will remain separate. Conventional wisdom suggests that retail data will be firewalled not only from other Neptune-managed retail media networks, but from consumer promotion programs and activations as well.

While the merger will likely add to Neptune’s growing representation within retail media networks, there are still gaps with several key national retailers — namely, Walmart and Kroger remain outside of the new company’s reach. And while Neptune has an impressive array of retailers for their in-store offerings, Quotient competitor Inmar’s lock on digital coupons and retail media for regional and independent retailers still blocks true 360-degree activation across a full spectrum of chains.

4. Digitization of all shopper marketing touch points will continue. Both Quotient and Neptune have embraced the programmatic delivery of messaging to reimagine DOOH for the shopper space. We expect Neptune to take full advantage of Quotient’s tech stack to reimagine and digitize in-store media as well, leveraging — and perhaps integrating — nascent platforms like Cooler Screens, Perch, and Gas Station TV into the mix for real-time digital message delivery in store. Driven by the proliferation of digital screens, the commoditization of digital media buying, and the availability of first and zero-party data we can anticipate a day when a fully digital, personalized, integrated in-store and on-line shopping journey is a reality.

5. What about the coupons? Both parties have been tight-lipped about the future of their various coupon platforms. From changes to Neptune’s traditional “Smart Source” FSIs and the sunsetting of SmartSource.com, to the sell-off of Coupons.com and the shuttering of its app, each company’s legacy platforms have been transitioning (if not declining) in recent years.

The rise of retail media and the COVID-driven acceleration of ecommerce fundamentally changed the coupon landscape. The challenge of third-party access to retail coupon galleries created less-than-optimal user experiences for both Coupons.com and SmartSource.com shoppers. The use of traditional print coupons in ecommerce transactions remains nearly non-existent.

These changes hastened a supply-side shift from coupons to rebates for national offers, further frustrating shoppers. As this occurred, Checkout 51 and Shopmium failed to differentiate or chip away at the dominance of rival Ibotta, leaving them struggling in the long tail of shopper rebate platforms.

Unlikely to abandon the platforms entirely, a merger is likely, and differentiating against Ibotta will be necessary. Neptune’s in-store capabilities, coupled with its growing retail alignments, can accelerate both awareness and conversion to a stronger, combined app that smooths out the user experience.

Final Thoughts: Through the acquisition, Neptune is potentially gaining access to multiple retail media networks, some digital coupon infrastructure, and technology improvements across redundant media platforms and product offerings. The company has been quiet about the plan so far, but retail media and a reimagined in-store experience seem likely directions.

With 85% of all grocery purchases still occurring in a brick-and-mortar store, Neptune now seems poised to maximize the convergence of in-store shopping and digital media consumption to deliver the “phygital” demands now driving shopper behavior. The company’s in-store expertise and alignment with retail media networks make them uniquely prepared to accelerate these shifts.

We also expect Neptune to continue providing the excellent partnership we’ve established with them in the service of our clients.

About the Author
Julie Argonis is VP-Media Strategy at The Mars Agency, where she imagines, then activates, national shopper marketing programs for Campbell’s and Campbell’s Snacks, Pfizer, and MilkPEP.

Her 20 years at Mars and experience on the frontlines of broadcast promotion have made her an expert at media strategy, audience engagement, and producing results.

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