There’s never been a better time to offer coupons and/or promotional codes than right now, in the current economic conditions.
Consumers have started to rediscover ‘The Joy of Coupons’, with US coupon usage rising in 2009 for the first time since 1992. That’s according to Inmar, a leading promotion transaction settlement provider.
US coupon distribution in 2009 hit the highest level recorded since Inmar began tracking trends in 1988. For the first time in 17 years, consumers used more coupons than they did the year before, with 3.3 billion consumer packaged goods coupons redeemed, a 27% increase over the 2.6 billion redeemed in 2008.
The rise in coupon use started in October 2008, coinciding with news of the US financial crisis. That has led to five consecutive quarters of double-digit growth (based on percentage change from the same period of the previous year).
The increase in redemption goes hand-in-hand with an increase in distribution. Despite the tight economy, marketers invested heavily in coupons, boosting the number available to the highest level in over 30 years. Brands issued 367 billion coupons, at an average face value of US$1.44, indicating that they were committed to promotions in 2009.
Of particular importance to our constituency:
- Online coupons also contributed to the rise in coupon distribution and redemption, with internet distribution up 92% and consumer redemption of these coupons up over 360%.
However, in spite of the meteoric rise in online and digital couponing, the traditional newspaper-distributed couponed inserts still account for 89% of all coupons distributed and over half of the coupons redeemed. American consumers expect to find coupons in their Sunday papers, and they will continue to look there for them.
As coupon numbers across the board rose in 2009, brands were forced to mitigate the cost of increased redemption by maintaining face values and keeping expiration periods in check. In 2009, face values declined by a penny, reversing a multi-year trend of increasing values. Expiration periods were shortened by 10% last year, after years of virtually no change.
So — time to get into couponing and promotional offers (if you hadn’t already). Just one note of caution — be totally transparent about your offers, and avoid falling into the trap that Borders did (which attracted the attention of an unwanted suitor, the Commerce Commission):
In November and December 2009 Borders advertised a promotion with the headline offer “Receive $20 in vouchers for every $75 you spend at Borders until Christmas.” The promotion was widely advertised in-store and online through an e-newsletter and on Borders’ website. However, the small print of the offer specified that customers could only redeem one $10 voucher in January and a second $10 voucher February, which, in the Commission’s view, materially changed the headline offer.