Savings events soar in ’09, key to ‘10

January 22, 2010

Will 2010 be as explosive for cents-off coupon activity and retailer promotions as 2009?

Will 2010 be as explosive for cents-off coupon activity and retailer promotions as 2009?  We say yes at because these marketing shifts show how intently CPG companies are working with food stores to influence consumer decisions as people plan their trips, approach the shelves, and decide among competing brands.

As long as the recession weighs on families, we feel that success will come from keeping brands and stores relevant within the chief shoppers’ value-seeking thought loop. Because ‘saving’ is the key component for so many households – and will be until the economy gains a secure foothold – we predict that coupons and promotions will become even more central this year.

Activity in these areas grew significantly in 2009:

  • More than 272 billion ‘coupons dropped’ in this past year represented an 8% gain over 2008, and reached the highest level in a decade, reported Marx Promotion Intelligence, a division of TNS Media Intelligence. The previous high was 257 billion in 2007.
  • More than $385 billion in consumer incentives were delivered via FSI coupons, up 15% over 2008.
  • Manufacturers are seeking more immediate and dramatic impact with consumers in two ways – a 6.5% rise in average face value (to a record $1.42 per coupon) and a 3.9% shorter expiration date to 9.3 weeks.
  • The CPG sector accounts for a 71.5% share of FSI pages.
  • More than 9 billion retail promotion pages set an annual record, up 37.7% over 2008 and extended a stretch of significant annual growth since 2007, according to Marx.

A rebound in new product introductions in 2009 also contributed to the growth of FSI (freestanding insert) coupons. The coupons supported 388 launches in 2009, up from 334 in 2008, notes Mark Nesbitt, president, TNS Media Intelligence. “As consumers adapt to new economic realities, marketers are increasing their use of FSI coupons within their marketing mix to deliver advertising impact, influence consumer behavior, and secure retailer distribution and merchandising. Leading retailers are also increasing their use of FSI vehicles to drive planned shopping trips and build shopper loyalty,” he adds.

Value will remain a dominant theme in 2010. The brands and stores that integrate this with their other messages could be within the purchase set of more consumers – but ought to take care not to undermine their long-term pricing integrity.