Coupons have been a hot topic lately, reviled by J.C. Penney Co. Inc.’s chief executive officer, Ron Johnson, who’s been trying to break consumers’ addiction to coupons and promotions by promising day-in-day-out fair prices. One coupon cheerleader is Cotter Cunningham, founder and ceo of, which had revenues of $120 million last year and owns a variety of coupon Web sites. One of the largest,, has 450 million visits a year and offers 500,000 coupons for 100,000 stores.

This story first appeared in the July 23, 2012 issue of WWD. Subscribe Today.

“We’re the largest coupon site in the U.S.,” Cunningham said. Half of the coupons on the site come directly from retailers. Others are posted by users.

RetailMeNot launched its mobile site last year and recently introduced its first native app for iOS. Cunningham said RetailMeNot has also figured out a way to connect coupons to shoppers’ credit cards so discounts automatically appear on their receipt. RetailMeNot partnered with First Data and CardSpring to develop the credit card feature, which is still in beta and has yet to be integrated into the mobile app. In the third or fourth quarter, RetailMeNot will launch an Android app.

Cunningham said RetailMeNot partners with retailers and shows them how to use coupons profitably. “Coupons are used to bring in new customers or clear merchandise,” he said. “It’s easy for us to drive traffic. Brick-and-mortar retailers are looking to replace the Sunday supplement [with online coupons],” he said. “The cycle to print Sunday supplements takes 20 weeks. Online, we can put an ad up in 30 minutes to one hour.”

There are things retailers can do to make shopping with coupons run more smoothly. Adding a numerical code would help at the cash wrap because many scanners used by retailers don’t pick up the bar code. “Retailers need updated technology [scanners] to read bar codes better and train staff better. Consumers find no shame in using coupons — they’re even accepted at Nordstrom,” Cunningham said.

Coupons from RetailMeNot are for in-store use only. “We see our app fighting showrooming,” Cunningham said. “There’s a big trend of people in stores looking at, say, Gap T-shirts to make sure online and off-line pricing are the same. The future is in GPS advertising. You’re in a Nordstrom and, ‘ding, ding, ding,’ you get a message, ‘here are five items on sale at Nordstrom.’”

Cunningham is bullish on Facebook, which he said “has a huge head start for personalization. The number-one reason people follow brands is because they’re looking for deals.”

The two-and-a-half-year-old company received $150 million in venture capital last year, which it used to grow its market share of the retail industry. “We’re thinking about an IPO in the next 24 months,” Cunningham said.