Coupon Distribution Growth (Volume in Billions; All Media) | ||||
| First Half: | |||
| 2008 | 2009 | 2010 | 2011 |
Coupons Distributed (Billions) | 141 | 158 | 178 | 167 |
% Change/from previous year | -6.6% | 12.1 | 12.7 | -6.2 |
Source: NCH Marketing Services, July 2011 |
Although fewer coupons were offered during the first half of 2011, consumers remained responsive to the coupons available to them. Total redemption reached 1.75 billion coupons, a moderate 2.9% increase over the same period in 2010. As the first half progressed, coupon redemption saw a marked increase due to a number of factors, including: the permanent shift toward a value-oriented consumer mindset; rising food and gas prices; and increased availability of digital offerings.
CPG Redemption Volume (Billions; All Media) | ||||
| First Half: | |||
| 2008 | 2009 | 2010 | 2011 |
Coupons Redeemed (Billions) | 1.325 | 1.575 | 1.700 | 1.750 |
% Change/from previous year | -3.6 | 18.9 | 7.9 | 2.9 |
Source: NCH Marketing Services, July 2011 |
The largest share of coupons, 89.6%, was allocated to Free-Standing Inserts (FSI) via newspaper and shared mail delivery methods. This reflects an increase of 2.1 share points from the first half of 2010.
Coupon Allocation (% of Total Coupons Distributed) | |
Media | % of Total |
Free Standing Insert (FSI) | 89.6% |
Handout in-store | 4.4 |
Direct mail | 2.4 |
Magazine | 1.3 |
In/on pack & cross-ruff | 1.0 |
All others | <2 |
Source: NCH Marketing Services, July 2011 |
The average face value offered during the first half of 2011 was $1.57, up 5.4% from the same period last year. Additionally, 27% of all coupons distributed in the first half of the year required multiple purchases, up three share points from the same period a year ago. Marketers also continued to limit the duration of offers, with a 10.1 week average fuse from drop date to expiration date. This continues a trend shift first observed at the end of 2010, when the average expiration was cut by a week and a half to 10.1 weeks.
CPG Coupon Purchase Requirements (All Media) | ||
Condition | 1st Half 2010 | 1st Half 2011 |
Average face value | $1.49 | $1.57 |
Multiple purchase requirement (% of total distribution) | 24% | 27% |
Average offer fuse (weeks/all products/all media) | 11.3 | 10.1 |
Source: NCH Marketing Services, July 2011 |
Among retailers, redemption volume increased in the first half of 2011 across several channels, including: drug stores experiencing 26% growth; other store types including dollars stores up 11.2%; and mass merchants up 10.4%. This trend is consistent with pre-recession shopping behaviors where non-traditional retail channels were seeing a growing share of redemption volume at the expense of traditional supermarkets.
Retail Coupon Redemption Volume (1st Half 2011) | |
Channel | % Change vs. 2011 |
Grocery stores | -3.1% |
Mass merchandisers & supercenters | 10.4 |
Drug stores | 26.0 |
Military commissaries | -4.8 |
All other | 11.2 |
Source: NCH Marketing Services, July 2011 |
Redemption by Media Type (Offers Distributed 1st Half, 2011) | ||
| % Redemption | |
Media Type | Grocery Average | HBC Average |
Free Standing Insert | 0.9% | 0.4% |
Newspaper | 0.8 | na |
Magazine | 1.0 | 0.8 |
Direct mail | 3.3 | 1.8 |
Regular in-pack | 4.1 | 4.5 |
Regular on-pack | 6.9 | 14.6 |
In-pack cross ruff | 2.4 | 2.4 |
On-pack cross ruff | 4.4 | 10.3 |
Instant on-pack | 22.6 | 28.5 |
Instant on-pack cross ruff | 8.9 | 9.1 |
On-shelf distributed | 9.5 | 9.2 |
Handout/electronic dispensed | 8.8 | 6.3 |
All other in-store handouts | 3.1 | 2.3 |
Internet home printed | 16.9 | 13.6 |
Military | 10.6 | na |
Source: NCH Marketing Services, July 2011 |
In total, consumers saved $2.0 billion with coupons through mid-year 2011, up 5.3% from the first half of 2010.
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I love coupons, as a consumer and as a consumer strategist. Interesting that the average face value is so high at roughly $1.50--I'd like to see volume by face value as a more telling indicator of which offers are converting sales. In addition to these usage figures, I think it's fascinating how coupons transcend demography and can strike appeal for the more affluent segments, as well. I debunk a few more coupon myths here: http://luminositymarketing.com/blog/?p=4112
Kimberly Conon
Luminosity Marketing