Despite a steady amount of CPG coupons distributed by marketers in 2012, US consumers redeemed 17.1% less coupons than in 2011, according to a study from NCH Marketing Services. Total consumer savings on CPG coupons declined by $800 million in 2012, to $3.7 billion, representing an 17.8% decrease. The decline comes after 3 consecutive years of increases, but savings in 2012 remained above 2008’s total of $2.9 billion. The year-over-year decline can be attributed not only to declining redemption volume, but also to lower attractiveness, as the average face value distributed and redeemed each dropped by 2 cents (to $1.53 and $1.27, respectively). Additionally, multiple purchase requirements rose from 27% to 29% of all coupons, and the duration of the average offer declined by more than half a week.
CPG coupon redemption volume dropped across all retailer formats in 2012. Redemption volume at drug stores declined the fastest (-26.5%), followed by grocery stores (-18%) and mass merchandisers (-16.2%).
At 90.1% share by distribution volume, free-standing inserts (FSIs) remained the dominant media format by which marketers distributed coupons in 2012. In-store handouts were a distant second at 3.9% of distribution volume, followed by direct mail (2.1%), magazines (1.4%), in/on package and cross-ruff (a coupon on one product redeemable for another ”“ 1.1%), and the aggregate of all others (including newspapers, handouts away from stores, military distribution and surprisingly, all digital formats ”“ <2%).
However dominant FSIs were by volume, they were less so when looking at share of redemption volume, accounting for 51.4% of total redemptions. In/on pack and cross-ruff accounted for 18.2% of all redemptions, and in-store handouts for 14.2%. Internet home-printed coupons accounted for 5.6% of all redemptions, with paperless coupons (C2C and mobile) capturing 1.3% share.
About the Data: Coupons distributed and redeemed in the U.S. Consumer Packaged Goods (CPG) marketplace are studied utilizing NCH’s manufacturer client databases, data cleared via its retailer processing operation and other independent sources. NCH’s proprietary methodology utilizes rigorous controls and statistical standards to maintain the integrity of the information contained in its report, as well as, all other information tools supplied by NCH.
Data points from client and market sources are dynamic. As such, projections are based on the most current information available at the time of publication and may be revised in the future. Also, due to rounding, the sum of certain percentages may not equal 100 percent. The scope of the NCH report includes Manufacturer Coupons of all paper and paperless media formats that are most typically funded by CPG marketing budget allocations for consumer promotion. Retailer In-Ad coupons are not included in the report, as they are most often funded by trade dollars. Consequently, In-Ad distribution and redemption are less precisely tracked by manufacturers. C2C is an abbreviation for coupons download to retailer loyalty cards or unique identification numbers. The scale of C2C and mobile coupons is limited by enablement of retailer point of sale systems, currently deployed primarily in the grocery retail channel.
The report also contains various references to NCH’s most recent Consumer Survey. The data was obtained in August of 2012 using a market research firm with proficiency in Internet surveys. The sample was derived from an online consumer opinion panel, and all participants were at least 18 years of age and living in the contiguous United States. Consumers were emailed an invitation to participate in the survey and were given three days to complete it. The survey was closed once 1,000 completed responses had been reached. The responses were weighted by factors obtained from national census data to provide appropriate representations of demographic groups at summary levels.