CPG Coupon Redemption, Value Saw Unprecedented Growth in 2009

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CPG Coupon Redemption, Value Saw Unprecedented Growth in 2009

According to the “2010 NCH Coupon Facts Report” released by NCH Marketing Services, Inc., a Valassis company, current economic conditions are causing 94 percent of those surveyed to use consumer package goods (CPG) coupons at least once in the past year, and 77 percent regularly. Further, 30 percent said they used more coupons in 2009 than in the past, resulting in $800 million more being saved with CPG coupons vs. the prior year.

The percentage of consumers planning their shopping lists with CPG coupons is up considerably during the recession. Last year, 88 percent matched their shopping lists with coupons, compared with 78 percent in 2007. Additionally, new shopping habits will stick even as consumers’ personal economic situations improve, based on responses to four questions asked in the NCH Consumer Survey:

—31 percent are more careful about remembering to bring coupons to the store, with 74 percent of those respondents expecting this behavior to continue
—25 percent are clipping more coupons than before, with 72 percent expecting this habit to continue
—6 percent are clipping coupons for the first time, with 58 percent expecting to keep clipping coupons in the future
—3 percent have joined coupon clubs or attended meetings about coupons, with 50 percent expecting to take part in such activities in the future

“With consumers’ strong focus on value and a greater reliance on research and planning, these upward trends point to a permanent change in the mindset of today’s deal-seeking shopper,” noted Valassis chief marketing officer Suzie Brown. “Tomorrow’s shopper will be just as savvy. The new findings also reinforce the fact that consumers won’t part as easily with their hard-earned money without pairing it with a deal in print or digitally.”

Overall, CPG coupon redemption rose by 23 percent in 2009 — the second-highest year-over-year growth rate ever recorded. Redemptions continued to grow each quarter in 2009. Redemption for grocery products increased 25 percent, representing 2 billion coupons, while redemption of health and beauty care products went up 20 percent, representing 1.2 billion coupons.

Marketers issued more high-valued coupons in 2009, with 74 percent of them requiring the purchase of just one item to get the discount. The average face value of a CPG coupon increased 6 percent in 2009 to $1.37. More specifically, the average face value of a grocery coupon in 2009 grew to $1.16, with 67 percent of them offering face values greater than 75 cents. On the HBC coupon front, the average face value in 2009 increased to $1.82, and 86 percent of such coupons issued in 2009 had face values of more than 75 cents.

As with value, coupon distribution increased in record proportion last year, with 311 billion coupons in the marketplace, representing an 11 percent increase by CPG manufacturers. Grocery coupons made up 64 percent of the CPG coupons issued in 2009.

“As CPG marketers faced the pressure of maintaining sales and fending off private label competition in the midst of the worst recession since the Great Depression, they strategically increased their use of coupon promotions in 2009 across all major forms of coupon media,” said NCH VP of marketing Charlie Brown.

CPG marketers continued to place the largest share of coupons in cooperative free-standing insert (FSI) coupon booklets, which accounted for 86 percent of CPG coupon distribution in 2009. Meanwhile, the Internet represented just 1 percent of CPG coupon distribution in 2009 — a rise of 50 precent from 2008 — the redemption share was almost 10 percent.

“Internet coupon distribution remains a small portion of the total CPG coupon media market, but it is growing faster than any other medium,” observed Brown. “As redemption rates of online coupons increase as well, these trends indicate that CPG marketers are using the Internet more and more to reach consumers with coupons, and consumers, especially in current economic times, are responding at an increasing pace.”

The full report is available free by registering at www.NCHResourceCenter.com.

Valassis is a Livonia, Mich.-based media and marketing services company. Its RedPlum media portfolio goes out weekly to over 100 million shoppers across a multimedia platform.