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Coupon distribution growth builds on record breaking trend and boosts redemption

Friday, July 23, 2010

Press release from the issuing company

Livonia, Mich. - Valassis, one of the nation's leading media and marketing services companies, announced today that first half 2010 coupon distribution and redemption continue to build on the record-breaking growth trends of the past year. In total, consumers saved nearly $2 billion with coupons in the first half 2010, a 37% increase over pre-recession levels.

Marketers offered 18 billion more consumer packages goods (CPG) coupons in the first half of 2010, up 11.4% from a year ago and 24.8% from mid-year 2008. These findings were revealed as part of the Mid-year 2010 CPG Coupon Facts Report, released by NCH Marketing Services, Inc., a Valassis company.

As shopping behavior has become more entrenched in value-oriented habits that originated during the recession, overall redemption volume has increased 7.9% year-to-date, with a higher growth rate (+12%) coming from the Health and Beauty Care (HBC) segment in 2010. The sustained growth in coupon redemption volume produced the seventh consecutive quarter of year-over-year increased usage. HBC marketers also increased their use of coupons at the fastest pace, up 20.8% from a year ago, compared to 6.7% for the grocery segment

"Marketers have increased their promotional activity as consumers have embraced mindsets toward value and are defining what has been called the 'new normal' when it comes to these learned shopping behaviors," said Suzie Brown, Valassis Chief Marketing Officer. "Consumers are adjusting their spending and becoming more strategic in their purchases as deal seeking escalates. Today's shoppers don't leave the house without their coupons and they don't seek savings in just one place or from one media source."

First-half 2010 findings also reveal a shorter expiration of 9.5 weeks compared to 10.6 weeks for the full year of 2009. In addition, face value is up to $1.43 for the first half of 2010 compared to $1.37 for 2009.

"More coupon discounts are crossing retailer checkouts as distribution and redemption are on the rise," said Charlie Brown, NCH Vice President of Marketing. "However, as marketers are using coupons to motivate consumers and support the retailers selling their products, they also are changing tactics when it comes to face value, offer duration and multiple purchase requirements." The average face value offered across all coupon media has grown 4.4% from a year ago; duration shortened by a week; and more than a quarter of all coupons require the purchase of two or more items

Overall, CPG marketers continue to allocate the largest share of coupons - 85% - in the free-standing insert (FSI) via newspaper and shared mail delivery methods. The Internet continues to grow at a much faster pace than all other distribution media, up 79% from a year ago. It represents 1.2% of all coupon distribution, the report revealed.

Among retailers, the largest increase in redemption volume so far this year has been in convenience stores, warehouse clubs and discount variety chains, such as dollar stores. Redemption across those store types as a whole is up 36.6%.




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