March 24, 2013

The great coupon debate

A double-digit drop in the number of coupons used in 2012 might be a fluke. Or not.

By AMY DUNN McClatchy Newspapers

The number of coupons used by Americans to stock their pantries plummeted 17 percent in 2012.

Coupn drop
click image to enlarge

Coupons are sorted as the Savvy Savers Coupon Clippers gather in Garner, N.C., to swap their unwanted coupons for ones they want or need.

McClatchy Newspapers

After surging during the Great Recession, the old-fashioned savings tool seems to have lost favor among consumers. Or has it?

Coupon industry insiders disagree on whether the drop is an aberration caused by a poor mix of coupon offers in 2012 or whether it signals the beginning of the end of the paper coupon era.

"There's a lot of discussion within the industry," said John Morgan, executive director of the Association of Coupon Professionals, the coupon industry's trade organization.

"The industry is not used to having double-digit (swings) either way," Morgan said. "That's a big deal. Historically, it has been slow single-digit (increases or decreases) either way."

With an uneven economic recovery as the backdrop, coupon-clipping shoppers have taken notice.

Kim Maney, 38, of Apex, N.C., shops at multiple supermarkets and drugstores, follows coupon blogs and takes advantage of double- and triple-coupon offers to stock her pantry. A lawyer, wife and mother of a 2-year-old, Maney said she has noticed a drop in the quality of paper coupons.

"A quarter off toilet paper? Really? What am I going to do with that?" said Maney, who admits to being "horrified by the idea I'd have to give somebody full price for something."

Last year, U.S. consumers redeemed 2.9 billion coupons on consumer packaged goods, which includes everything from cereal to toilet bowl cleaner. That's according to the most recent tally by NCH Marketing, a Deerfield, Ill.-based company and one of the country's major coupon clearinghouses. NCH is a division of Valassis, which publishes the Red Plum coupon inserts for newspapers.

The 17.1 percent drop in 2012 is even more dramatic considering that the total number of coupons made available -- paper and digital -- remained steady at 305 billion.

Charlie Brown, vice president of marketing at NCH, attributes the decline to a calculated move by manufacturers to correct an "unusually high" redemption rate in 2011.

Coupon redemption reached 3.5 billion coupons redeemed in 2011, a 6 percent increase over the previous year and a 26 percent increase since before the recession.

During the worst of the economic downturn, Morgan said, "marketers ramped up (coupon offers) to protect their market share."

In 2012, manufacturers put the brakes on coupons. The coupon values became skimpier, the expiration dates shorter, and oftentimes the coupons required that shoppers buy two or even three of an item before getting 55 cents off.

Manufacturers also issued more coupons for new products, which Brown said, "doesn't have the same level of appeal."

"For the manufacturer, the redemption of the coupon is an expense," he said, so they purposely made the coupon offers less attractive. "They don't want 100 percent of the coupons redeemed."

Coupon shoppers Veronica Shores, 48, of Raleigh, N.C., and Michelle Morton, 42, of North Raleigh, have also noticed the decline in coupon quality and adjusted their shopping habits to compensate.

Shores is on a fixed income and has relied on coupons to help make ends meet. She attends local coupon swaps, where she meets with other coupon clippers thumbing through stacks of everyone's cast-off coupons looking for the ones their families will use.

"They have really started dropping the coupon values," she said at a recent monthly swap held at Wake County's Southeast Regional Library in Garner, N.C. "It makes it harder to save." To supplement her coupon savings, she's also using more store brands.

In contrast, Morton has cut back on her coupon use. Raising three kids, she started wondering if her time clipping and organizing all those little slips of paper was time well spent.

(Continued on page 2)

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