By Frank Kroger, Vice President, Shopper Marketing, Valassis
Published Wednesday, Aug 3, 2016
In this election year let’s draw some analogies between a candidate’s run for office and the ever-popular coupon. Yes, you heard right. After all, coupon use is part of a long-standing American tradition. Since the first coupon was invented by Coca-Cola in 18871 to the introduction of the free-standing insert (FSI) over 40 years ago, it has transcended gender, demographics and advertising mediums.
Coupons Get the Popular Vote
Coupons are sought out by the majority. For consumers, coupons have become an essential tool in their arsenal for budget management. They are generational and economically-agnostic adored by both the millennial and boomer generations and sought after regardless of income. Today, 90 percent of consumers say that they use coupons, and 87 percent of coupon users used the same number or increased their use versus the previous year.2 Marketers also continue to see their benefits, investing over $515 billion in FSI incentives in 2015, up 3.7 percent3, as a way to bring in new buyers, maintain loyal buyers and help defend against competitive threats such as new category introductions or private label momentum.
Popular? You bet.
Coupons are Powerful Influencers
Much like presidential candidates, coupons have the ability to quickly influence a mass audience and move them to action. Print and digital media (which include coupons and offers) now influence 64 percent of an adult’s grocery purchase decisions with 62 percent of millennials and 66 percent of boomers influenced by them.4 Historically, marketers have relied on the amount of time a consumer spends with each medium to determine how to allocate promotional dollars. This strategy, however, is more effective at identifying consumer attention on certain media rather than identifying which media actually influences a purchase. From this perspective, print and digital activation are clear winners in the grocery influence game, especially when they carry a coupon.
Coupons Create an Impression
To the consumer, coupons offer unquestionable value within a promotional campaign and are accessible whenever a consumer desires, across multiple devices and mediums. With this ubiquity comes a willingness and widespread acceptance from consumers and this is positive news for marketers. Consider some of these groups2:
The acceptance and excitement of coupons is widespread, even as marketers continue to adjust the formula of coupon attributes in order to find the balance between an efficient incentive delivery and a positive return on investment. The FSI is hard to ignore in this case, delivering broad scale and volume. But as budgets tighten, so do the coupons/offers and the strategy with which they are delivered.
Coupon clearinghouses cite the ongoing trend toward higher coupon values and shorter coupon expiration times5. FSI trends from Kantar Media confirm the same: Food FSI values increased 5.0 percent to $1.19 but decreased fuse time 1.9 percent to 8.1 weeks. Similarly, Non-food values increased 1.6 percent to $2.08 and expiration date dipped to 5.4 weeks, down 8.9 percent. Some marketers are also experimenting with high values and one- to two-week timelines as a way to drive short-term, high volume sales.
There is one ideology that will prevail regardless of the presidential campaign winner in November: Coupons are in for the long haul – they’re as American as apple pie. And chances are you can probably find a coupon for that pie!
1Time, “The History of Coupons,” 2010
22016 Valassis Coupon Intelligence Report
3Kantar 2015 Free Standing Insert Distribution Trends
4Prosper Insights and Analytics, MBI database, January 2016. Paid media only; Grocery (Food/Cleaning/Beauty) purchases
5NCH 2015 Year-End CPG Coupon Trends