If there is one thing that has remained constant over the past century of marketing, it's the fact that customers like getting the best deal and incentives when they shop. According to a 2017 report from Valassis, nearly 61 percent of consumers are influenced by coupons on their grocery purchases. A more recent analysis from a subsidiary of Valassis shows how coupon use changed over the course of 2017.
NCH Marketing Services, a subsidiary of Valassis, created a report that analyzed the way consumers used coupons to buy Consumer Product Goods (CPG) in 2017. As one would expect, the study showed that a huge amount of coupons were retrieved last year. The report
reveals that consumers achieved $3.1 billion in savings over the last year, with the average face value of coupons available increasing to $1.95.
While the amount of coupons used and redeemed in 2017 is impressive, it actually represents a decline from recent years, even if there were increases in some areas, like the use of digital coupons. According to NCH, CPG marketers drove a 27 percent increase in overall digital distribution.
The increase in digital distribution contributed to an additional 47 percent in paperless coupon redemption, however, it was less than 12 share points of the total 2017 redemption, and insufficient in scale to replace volume shifted from marketers' other coupon strategies. To make a long story short, the overall CPG coupon redemption declined in 2017. The decline shows that business owners and marketers aren't doing enough to get coupons to customers who want to use them
"The challenge of delivering the right coupon media mix is not new to CPG marketers, but it is now compounded by a changing retailer landscape, shifting consumer product preferences and value-seeking shopping behaviors across the path to purchase," said Charlie Brown, one of the researchers from NCH, in a press release. "Marketers are striving to continually optimize and improve results, and when it comes to coupons, that takes a bit of art and data science to build the appropriate coupon strategy. Companies who strike the right balance of print and digital media can expect improved results in a transforming CPG environment."
The report found that the most common way to send coupons is still a free-standing insert, such as what a consumer would find in a newspaper or in their mailbox. According to NHC, this media channel represented 93.7 percent of coupon distribution volume and was the top media format for redemption volume as well.
An analysis by Kantar media added information on how the coupons in inserts have changed. The average number of CPG coupons per FSI page increased 5 percent to 2.1 in 2017. Additionally, the NCH's analysis found that coupons appearing alone on an FSI page generate 17 percent more redemption volume, on average, compared to coupons that share an FSI page with other coupons.
It's important to think outside of the box when crafting coupons. Many people are used to the idea of coupons for food and drinks, but it's important to remember the growing market for non-food coupons. According to the report, nearly 70 percent of all CPG coupon distribution was in non-food categories, such as over-the-counter health care products and household goods.
As they have been for decades, coupons remain an important tool for business owners and marketers. Billions of dollars worth of coupons are used every year and consumers are looking for them. Business owners that use multiple channels to reach potential customers with great offers are sure to succeed in 2018.
For more recent research that can help business owners and marketers, read this article on the benefits of PPC ads.