The U.S. Mid-year 2013 CPG Coupon Industry Facts Report prepared by NCH Marketing Services Inc., a Valassis subsidiary, reveals a 1.8% increase in coupon distribution, driven by an increase in the non-food segment. In the first half of 2013, coupons for non-food products represented 62.5% of all coupons distributed, a 2.9% increase from the first half of 2012. Overall, CPG manufacturers issued 168 billion coupons in the first six months of 2013.
The largest volume of coupons distributed in the first half of 2013 was via the free-standing insert (FSI), increasing this medium's share to 91.1%. Digital coupons have continued to sustain double-digit growth through expanded utilization by marketers, retailer integration that leverages their relationships with loyalty program shoppers and growing consumer adoption of new savings opportunities. According to this report, digital coupons represent less than 1% of all coupons distributed.
"CPG marketers continue to turn to the FSI to drive volume and market share through the significant advertising impact of FSI pages, and to align their offers with retailers that are increasing their use of the FSI," said Suzie Brown, Valassis executive vice president of sales and marketing. "At the same time, they are also expanding the use of digital formats that continue to grow but on a smaller scale. For marketers, it's about finding the right media mix and defining the coupon characteristics to both activate consumers and still drive ROI for their brand."
Marketers' strategic choices and tactical changes included:
• Shortening expiration dates by 3.2% to 9 weeks on average, led by the food segment where expiration dates were reduced by nearly one week.
• Extensively using coupons requiring the purchase of two or more products, particularly for food items, which represents 42% of their coupon distribution.
• Increasing the average face values distributed by 4.5% to $1.62, driven by non-food segment marketers, yet they have managed their total redemption liability through the mix of offers made available in the market.
"Following recession-driven years of unusual redemption growth, marketers have adjusted their strategies and we have seen indications of response stabilization," said Charlie Brown, NCH vice president of marketing. "In 2013 there is a wider divide among food and non-food products as they promote through a slightly different mix of media and tactics to achieve their individual objectives."
In response to the marketers' adjustments, redemption volume for the first half of 2013 declined 8.1%. Digital coupon formats, however, have grown, with redemption reaching 6.1% of the total for print-at-home coupons and 2.5% for paperless formats. That growth includes contextual coupon sites, retailer sites and a stronger integration in the media mix with desktop, social and mobile advertising campaigns.