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Marketers Increase Coupons, But Redemption Down

Coupon use is down, but still strong. And the growth area is non-food. According to NCH Marketing's 2013 Year-End Topline Coupon Facts report, the number of coupons issued to consumers for CPG products increased by 3.3% last year to 315 billion coupons distributed. But the total volume redeemed decreased last year by 3.4% to 2.8 billion.

Consumer interest in coupons remained strong, however. A report by NCH Marketing's parent, the 2013 Valassis Shopper Marketing Survey, found that about 81% of consumers reported using coupons regularly last year. Among those who reported using more coupons than the year before, 45.7% said they found that more coupons were available to them.

Non-food categories drove increased coupon use. Marketers distributed 5.8% more coupons in non-food last year, while food marketers distributed about 1% fewer coupons. Non-food redeems at a lower average rate than coupons promoting food products, notes the report.



Among those consumers who reported using fewer coupons in 2013, the most common reason -- articulated by about 49% of respondents -- was that they could not find coupons for the products they wanted to buy.

In terms of media, old-fashioned FSI's (free standing inserts) continued to grow as the dominant vehicle for distributing coupons, accounting for 91.2% of all coupons distributed and 50.8% of all coupons redeemed, per the report. But while they have broad reach, they also have low redemption rates. 

The study says digital coupons (including print-at-home, mobile, social, and downloadable coupons to a loyalty card) continued double-digit growth in 2013, although they still account for less than 1% of all coupons distributed, and their audience reach tends to be comparatively small. The redemption generated by digital coupon formats grew to slightly more than 10% of the total market volume.

The media mix has been toward the right blend of print, digital and in-store to optimize audience reach throughout the purchase path. FSI coupons have broad reach and relatively low redemption rates, but are popular with marketers who want to use them as a way to build shopper brand awareness.  

The research said there was also a trend toward marketers offering higher average face value, while offering less time to redeem coupons: from 9.3 weeks in 2012 to 8.6 weeks last year. The food segment saw the biggest drop in duration of offers. Thus, 28.7% of consumers who reported using fewer coupons in 2013 said the reason was that the coupons expired before they have a chance to use them. That was the second-most-cited reason for reduced use. In the food area redemption was flat last year, while media mix, products promoted and short duration resulted in a 100 million decrease in redemption volume. 

Grocery stores experienced the smallest decline in redemption volume; mass market was down 6.3%; drug coupon redemption was down 2.8%, and the rest of the retail formats dropped nearly 12%.

"Coupons and Money" photo from Shutterstock.

2 comments about "Marketers Increase Coupons, But Redemption Down ".
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  1. Grant Bergman from •, February 26, 2014 at 12:37 p.m.

    Note: I believe the reported data only cover centrally-processed coupons. I have been skeptical of package goods couponing for years and have run the numbers on them so many times that I feel confident they rarely pencil out on an ROI basis.

    OTOH, local retailer coupons may still have some merit as traffic builders. These typically are handled completely in-store or perhaps reported up through a chain or franchise organization, but they never see a clearinghouse for redemption and tracking. Would love to see a good study on that, but getting local retailers to track and report store coupons is a herculean task.

  2. Megan Cash from Sky Lending, September 3, 2014 at 8:22 a.m.

    Just be cautious in getting coupons online though. Use shop powerade coupons together with producer powerade coupons. Nowadays you can get all kinds of coupon codes online including kohls coupons printable.

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