• by Jack Loechner , Staff Writer @mp_research, January 19, 2010

According to Marx Promotion Intelligence, a division of TNS, free standing insert (FSI) coupon activity increased 8.0% during 2009 versus the previous year to more than 272 billion coupons dropped.  This activity level is the highest yearly coupons dropped observed during the past decade, surpassing the second highest annual coupons dropped of 257 billion realized in 2007. In addition, retailer promotion pages also achieved new record levels with a 37.7% increase to more than 9.0 billion pages in 2009.

Mark Nesbitt, President, TNS Media Intelligence,  "... although ‘shopper marketing' tactics are still evolving, FSIs have clearly emerged as a key component of manufacturer and retailer aligned promotion programs... manufacturers are using corporate scale FSI coupon events... to break through the promotion clutter... "

During 2009, more than $385 billion in consumer incentives were delivered via FSI coupons, up 15.0% from 2008.  However, Average Expiration (Fuse) remained below ten weeks with a decrease to 9.3 weeks, down 3.9% versus a year ago.  Manufacturers are delivering more offers of greater value to the consumer, but are managing their financial exposure by reducing the length of time that these offers are available in the market.    

Overall FSI Activity (2009 versus 2008)
Measure	2009%	Change
Dollars Circulated	$385 billion	15.0%
Coupons Dropped	272 billion	8.0%
Pages Distributed	203 billion	4.0%
Face Value (average)	$1.42	6.5%
Fuse (weeks)	9.3	-3.9%
Source: TNS/Marx Promotion Intelligence, January 2010

The Consumer Packaged Goods (CPG) sector remained as the largest user of FSI pages with a 71.5% share, followed by Direct Response, which includes general advertising activity, and Franchise, comprised of restaurants, portrait studios, and other businesses. 

Results by Sector (2009 versus 2008)
Sector	Pages (MM)	% Change	Share
CPG	145,497	6.1%	71.5%
Direct Response	38,797	-5.8%	19.1%
Franchise	19,191	10.3%	9.4%
Total	203,485	4.0%	100.0%
Source: TNS/Marx Promotion Intelligence, January 2010

Retailer promotion pages increased 37.7% to more than 9.0 billion pages in 2009.  Target continued to lead with more than 1.8 billion pages, up 43.9% versus 2008.  Dollar General increased 386.2% to more than 885 million pages to rank third during 2009.  These trends reflect the overall growth of retailer promotion within traditional FSI vehicles.

Top 10 Retailers based on Pages Circulated
Store	Rank 2008	Rank 2009
Target	1	1
PETsMART	4	2
Dollar General	10	3
Walgreens	2	4
CVS/pharmacy	3	5
Family Dollar	17	6
Kroger (banner)	5	7
Publix	7	8
Safeway Food & Drug	9	9
Rite Aid	13	10
Source: TNS/Marx Promotion Intelligence, January 2010

During 2009, there were 388 new products that delivered FSI coupons across 788 event dates as part of their introduction, averaging 2.0 event dates per new product.  This activity is up from 334 new products, 635 event dates, and 1.9 event dates per new product during 2008. 

Top 10 Categories for New Product Activity, 2009
Rank	Product Type	# New Products
1	Snacks	30
2	Alcoholic Beverages	25
3	Cereals	24
4	Milk/Milk Products	18
5	Prepared Food/Frozen	12
6	Household Cleaning Products	11
6	Pet Food & Treats	11
6	Beverages	11
9	Bread Product/Shelf	10
10	Pet Products	8
Source: TNS/Marx Promotion Intelligence, January 2010

In 2009, Non-Food categories distributed more than 160.9 billion coupons, up 5.3% versus a year ago, driven by the 7.7% increase within the Personal Care area.  Food categories distributed 111.6 billion coupons, representing an increase of 12.4%, led by the 7.8% increase for the Dry Grocery area. 

Additionally, manufacturers are increasing the value of the offers being delivered to consumers in both the Non-Food and Food segments.  Weighted average face value for Non-Food increased 7.4% to $1.73 and was combined with a 0.8 point decrease in multiple purchase requirements resulting in weighted average face value per unit increasing 8.1% to $1.54. These changes appear to be a response to economic pressures to increase the perceived consumer value of each offer relative to retail price, concludes the report.

CPG Non-Food vs. Food (2009 versus 2008)
Class	Coupons Dropped (MM)		Avg Face Value ($)		Avg Face Value Per Unit ($)		% Multiple Purchase		Avg Duration (weeks)
	2009	% Chg	2009	%Chg	2009	% Chg	2009	PtChg	2009	%Chg
Non-Food	160,924	5.3%	$1.73	7.4%	$1.54	8.1%	15.1%	-0.8	8.9	-2.8%
Food	111,642	12.4%	$0.97	7.5%	$0.73	7.3%	38.0%	-0.3	10	-5.3%
Total CPG	272,053	8.0%	$1.42	6.5%	$1.21	6.9%	24.4%	0	9.3	-3.9%
Source: TNS/Marx Promotion Intelligence, January 2010

The top 10 product types based on Coupons Dropped accounted for 34.8% of all FSI coupon activity during 2009.   Combination/Personal products (comprised of Personal Care brands which are promoted across multiple individual Personal Care categories) ranked first and increased 7.5% to distribute more than 13.3 billion coupons.

Top 10 FSI Product Types in 2009 (by Coupons Dropped*)
Rank	Product Type	Coupons Dropped (MM)
		2008	2009	% Chg	Act Chg (MM)
1	Combination/Personal	12,379	13,305	7.50%	926
2	Pet Food & Treat	12,677	13,182	4.00%	504
3	Household Cleaning Products	13,141	11,504	-12.50%	-1,637
4	Snacks	9,949	10,976	10.30%	1,026
5	Rug/Room Deodorizer	7,600	8,837	16.30%	1,236
6	Vitamins	8,275	8,748	5.70%	473
7	Cough/Cold/Sinus/Allergy	7,990	8,146	2.00%	156
8	Hair Care	6,953	7,522	8.20%	569
9	Shaving Cream/Razor	5,355	6,233	16.40%	878
10	AP/Deodorant	5,698	6,229	9.30%	531
Source: TNS/Marx Promotion Intelligence, January 2010

For additional information about this study, please visit Tnsmi-Marx here.