Consumers rediscover coupons
The humble coupon is back, in a big way.
Two years after the nation’s economy hit bottom in the most wrenching tailspin since the onset of the Great Depression, coupon use in the United States has staged a remarkable comeback.
Fueling the recent explosion in coupon redemptions is the Great Recession, which cut a huge hole in consumers’ budget for groceries, health and beauty items and everyday household needs, and a nimble coupon distribution industry that has fostered and exploited a massive rise in Internet-based coupon redemptions through personal computers and mobile devices.
“In 2010, marketers distributed more consumer packaged goods coupons than the prior year, reaching 332 billion,” noted NCH Marketing Services, a division of Valassis, in its Annual Topline U.S. CPG Coupon Facts Report. That marks a 6.8% increase over 2009, and “the largest single-year distribution quantity ever recorded in the United States,” NCH reported.
U.S. consumers redeemed 3.3 billion of those CPG coupons last year for a total savings of $3.7 billion. That’s a 5.7% increase from 2009, according to the research firm. “Consumer demand for coupons remained high in 2010 as shopping habits created during the most recent recessionary period sustained throughout the sluggish economic recovery that occurred during the year,” said Charlie Brown, NCH VP marketing. “In fact, [one]-third of the respondents in NCH’s Annual Consumer Survey said that they used more coupons in 2010 than the prior year.”
Retail experts agreed. “Coupon use has been increasing exponentially during the recession,” said David Fikes, director of consumer affairs for the Food Marketing Institute. “It leveled off a little bit over this past year, but it is continuing.”
“It’s like the trend of eating more meals at home,” Fikes told Drug Store News. “Some people are saying that even after the recession they’re going to continue doing that.” In addition, a younger generation has discovered coupons, “particularly with Internet couponing, which has taken off,” he said.
It’s a striking turnaround. Coupon use had been dropping precipitously for decades — from a peak of 4.6 billion coupons redeemed in 1999 to a nadir of just 2.6 billion per year during the three-year period ended in 2008, according to The Nielsen Co. But “the Great Recession of 2009 changed all that and marked a sort of renaissance for the coupon,” reported Todd Hale, SVP consumer and shopper insights for Nielsen.
The trend is likely to continue. “Fewer consumers are switching brands to catch a sale and trading down to private-label options, hinting at glimmers of optimism in a marketplace still marked by high levels of caution and frugality,” noted SymphonyIRI Group in its inaugural MarketPulse Survey report, unveiled March 30. “However, the number of consumers engaging in preplanning activities, such as coupon clipping and list making, remain virtually unchanged [from 2009] and are very much a part of consumers’ grocery shopping rituals.”
All signs point to a long-term shift in consumer behavior, said Susan Viamari, editor of Times & Trends for SymphonyIRI. “I think consumers, before the recession, were perhaps a little too carefree or free-spending. And now they’re saying, ‘We can save money relatively easily using coupons, and it’s not all that painful a process. So why would we want to abandon that just because the economy is a little better?”
The MarketPulse survey found that “just about half of consumers (47%) [said] they’re using more coupons today than they have in the past, which is consistent with 2009, when 49% said they were using more coupons than in the past,” Viamari told Drug Store News. “We also asked consumers ... if they would continue to do so in the coming year, and just about everyone, more than 90%, said they will continue to do so in the coming year.”
A recent report from CouponSense.com also foresaw a long-term shift in consumer behavior. “Looking at 2011, a combination of the recession, [the] ‘Extreme Couponing’ reality show, new product labeling and a new general attitude in America that saving money is socially responsible, 2011 will be a record year” for coupon redemptions, the company noted.