Evolving Coupons

The Lempert Report
August 27, 2013

The use of digital coupons is ever expanding.

The use of digital coupons is ever expanding, and the Consumer Packaged Goods industry is redirecting their efforts when it comes to coupon distribution and redemption. The NCH Marketing Services' "U.S. Mid-Year 2013 CPG Coupon Industry Facts Report", highlights some of these efforts. For example, in the first half of 2013, CPG coupon issuers: • Shortened expiration dates by 3.2% to nine weeks on average, led by the food segment where expiration dates tightened by nearly a full week; • Extensively used coupons that require the purchase of two or more products, especially for food items, which represent 42% of coupon distribution; • Raised the average face values of distributed coupons by 4.3% to $1.62, a shift led by nonfood marketers. A 1.8% overall increase in coupon distribution during the first six months of the year translates into 168 billion coupons issued, and although digital coupons still represent less than 1% of that, they have continued to sustain double-digit growth through expanded utilization by marketers…” states NCH. The report also looks at coupon redemption. Overall redemption fell by 8.1% in the first half of 2013 to a total savings of $1.8 billion. Yet redemption by digital coupon formats reached 8.6% of the total redeemed—including 6.1% for Internet Print-at-Home and 2.5% for Paperless formats such as Coupon-to-Card and Mobile coupons. Here at The Lempert Report, we believe that mobile coupon use will surge further once technology takes the redemption process out of cashiers’ hands. One possibility might be Dropbox, which bought Endorse in July. Endorse is a mobile app that credits deals, rewards and coupon values to shoppers’ bank accounts after users transmit photos of their receipts.