EXTENDED COUPON CODE CLEARS ITS FINAL HURDLE

DENISE ZIMMERMAN

DAYTON, Ohio -- A universal product code suffix that would allow manufacturers to include more scannable information on coupons and lead to a more efficient clearing system has gained final approval.

The UCC/EAN-128 extended code was approved by the Uniform Code Council Board of Governors by mail ballot last month. Manuals outlining the new standardized specification will be sent out to manufacturers beginning in September.

"It's been a long time in coming, but we're optimistic it's going to help us move the coupon redemption process forward," said Don King, associate director and manager of advertising services at Procter & Gamble, Cincinnati, and co-chairman of the scanning subcommittee of the Food Marketing Institute-Grocery Manufacturers of America Joint Industry Coupon Committee.

David Sefcik, manager of corporate scanning at Giant Food, Landover, Md., and co-chairman with King of the scanning subcommittee, agreed that the extended code should help speed up the implementation of a more efficient coupon clearing process.

"For the retailer, the benefit is going to be that coupons will be processed much quicker, and in return, payment will be received in a much more timely manner," he told SN in an interview.

The most immediate benefits of the UCC/EAN-128 extended code will be the ability to accommodate additional information on coupons, such as offer code, expiration date and household ID code. UPC coupon bar codes today typically capture information only on the discount value and, in some cases, the specific product or manufacturer.

With the new code, manufacturers can use one or more of the three components of the full suffix to encode information they want to capture. Altogether, the code could result in a 3-inch long UPC symbol, triple the length of

today's typical bar code.

The extended code could also speed up the testing of electronic coupon clearing, with the goal of eventually creating a fully paperless processing system, King said. "We don't think electronic clearing will happen overnight," he added, "but it is proceeding pretty rapidly."

King told SN that the suffix code may begin appearing on coupons as early as this winter, with the offer code the most likely component to gain widespread use in the near term.

"The basic coupon offer code is the most important component to most manufacturers. It provides critical offer information, so manufacturers can determine how their promotions are doing and how successful they've been. It also allows them to handle the financial charging," he said.

"The other components will be used to some degree, but I would not expect to see many [coupons] printed with the household ID information, simply because technology to print it efficiently doesn't exist yet," King continued.

Giant's Sefcik said that the flexibility of the UCC/EAN-128 extended code should help open up opportunities for new applications in the future.

"Retailers, manufacturers and clearing houses alike understand we have a lot to learn in the use of the extended code and this is a step in that direction -- and to learn about electronic clearing as well," he said.

Hal Juckett, president of the UCC here, said, "I think this is a progressive step in the management of coupon marketing and will lead to further automation and increased efficiencies. The quick pay system is gaining some momentum."

The scanning committee had been expected to endorse the extended code in late April, but the process hit an unexpected roadblock when last-minute objections relating to the code's scannability were raised. "We were hopeful to have had approval by late spring, and it did take a little longer," King told SN. "There was a little more comment, which frankly we want. We wanted to respond to it and hear whether there was any way to improve [the extended code].

"It's part of the process and ensures that we have a product here that will help both manufacturers and retailers in processing coupons more efficiently," he added.

The concerns that stalled earlier approval of the extended code related to the symbol's ability to be scanned from any direction -- and that issue called into question the symbol's size, explained the UCC's Juckett.

To ensure that coupons could be scanned omnidirectionally, he said, the height of the symbol's bars would have to exceed that of a standard UPC symbol.

However, the UCC's Symbol Technology Advisory Committee, as well as the scanning equipment manufacturer who raised the concern, agreed that coupons do not require the same omnidirectional scanning capabilities that, for example, a three-dimensional product does.

"You have a small piece of paper and you're going to have to orient it [accurately] to the scanner anyway, as opposed to a big box of cereal," Juckett said.

Once the matter of omnidirectional scannability was resolved, it was determined the height of the symbol should remain unchanged and the path was cleared for final approval of the code. A specifications manual for the UCC/EAN-128 extended code will be distributed at the annual UPC Conference, to be held Sept. 13 and 14 in Dallas. The publication can also be obtained by contacting the UCC office at 8163 Old Yankee Road, Suite J, Dayton, Ohio 45458. The phone number is (513) 435-3870.