CMS News & Events

Press: Coupon Distribution Surges 9% in 2004
(May 18, 2005)

Lifestyle Changes of Aging Baby Boomers Impact Redemption Trends

Overall coupon distribution in 2004 grew a healthy 9% to 342 billion coupons according to CMS, the premier provider of innovative promotion management solutions. Intense competitive pressure in the general household products category, occasioned by the introduction of roughly 1300 new products, spurred marketers within this category to increase coupon distribution significantly. Coupled with increases in other non-food categories such as healthcare and body care, consumers received the opportunity to save more than $318 billion on their favorite brands.

More than 82% of all consumer packaged goods coupons distributed in 2004 were delivered via colorful free-standing inserts (FSIs) in the Sunday newspaper, an increase over the previous year. "Delivered to over 67 million households every week, FSIs provide a relatively inexpensive method for distributing coupons," explains Bob Carter, president of CMS. "And savvy marketers, using increasingly sophisticated targeting strategies and metrics, are optimizing consumer response to their brand's coupon offerings while still using this traditional 'mass market' vehicle."

The impact of aging baby boomers continues to be felt in overall coupon redemption trends, which dipped 10% to 3.2 billion coupons. Explains Carter, "While the aging boomers continue to use coupons, their lifestyles are changing; every year, more and more boomers become "empty nesters" – buying for households of two instead of four or five." But thrifty shopping habits don't just fade away – although they may now report being "lighter" coupon users, 69% of primary shoppers report that they still "frequently or almost always check or clip coupons" as part of their shopping behavior. Additionally, the continued growth in meals consumed away from home contributed to lower coupon redemption. However, the declining trend appeared to soften in the fourth quarter, indicating consumers may ultimately be responding to the creeping inflation.

Tactically, marketers increased the average face value of coupons offered to consumers by eight cents to $0.93, allowing coupon users to save almost $3 billion on their grocery bills. "Though it's hard to bypass these generous savings, other tactics may discourage coupon usage by the consumer," according to Carter. "For example, the percentage of coupons requiring multiple purchases remained steady at 27%, and the average expiration period, or the length of time a consumer has to use a coupon, remained relatively stable at 3.0 months. This offering may or may not fit a given consumer's lifestyle and affects whether or not they'll be inclined to redeem that coupon."

Contact:
Matthew Tilley
CMS, Inc.
(336) 631-2524
matthew.tilley@inmar.com

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CMS, Inc. provides innovative promotional management solutions designed to deliver the maximum impact from every promotional dollar. We fulfill this promise by combining promotional expertise with the strategic use of technology and superior client service. Our clients benefit from efficient, proactive information management, analytical services, and processing and settlement solutions. CMS is an affiliate of Inmar, Inc. the nation's largest and most comprehensive provider of promotional settlement and information management services. Founded in 1980, Inmar serves over 700 packaged goods manufacturers and 375 retailers, processing more than 3.5 billion transactions annually. For more information, visit www.cms.inmar.com.

CMS is also proud to sponsor www.CouponInfoNow.com, the industry source for comprehensive information on planning and executing successful coupon promotions.

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Compiled by the promotion experts, CMS Trends 2005: A Promotional Planning Guide provides the most comprehensive industry information on coupon distribution and redemption trends. For more information, contact CMS at 1-336-631-2500, or e-mail marketresearch@inmar.com.

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