A substantial and growing body of research on coupons and coupon effec
tiveness has emerged in the marketing literature. The objective of thi
s paper is to review and consolidate the findings of previous studies
to provide a better understanding of the factors that influence consum
er response to direct mail coupons. The effects of coupon, brand, prod
uct category, and consumer characteristics on redemption behavior and
incremental sales are examined, and their implications for the effecti
veness of direct mail coupon promotions are discussed. Based on the fi
ndings of prior studies, a theoretical model of coupon effects on purc
hase behavior is proposed. Several key issues that need to be addresse
d in future research are identified. (C) 1996 John Wiley & Sons, Inc.