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Report: First-half of 2013 more promotional with $1.8 billion in consumer savings


LIVONIA, Mich. — Promotions were up across the front-end over the first half of 2013 as compared with the corresponding year-ago period. Couponing across non-food items were up 1.8%, according to the U.S. Mid-year 2013 CPG Coupon Industry Facts Report released Tuesday by NCH Marketing Services, a Valassis subsidiary.

Overall, consumers saved $1.8 billion in the first six months of 2013.

"Following recession-driven years of unusual redemption growth, marketers have adjusted their strategies and we have seen indications of response stabilization," commented Charlie Brown, NCH VP 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 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 majority through free-standing inserts. FSIs accounted for 91.1% of all coupons distributed in the period. 

Digital coupons have continued to sustain double-digit growth as more marketers adopt a digital strategy and more retailers employ an omnichannel loyalty program to attract and retain customers. But according to this report, digital coupons still 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," stated Suzie Brown, Valassis EVP 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; and 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.

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. The integrated campaigns, that companies such as Valassis are using, help marketers engage and activate today's always-connected consumer along their path to purchase. 

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