Why Coupons Are Still a Powerful Strategy for Brands

Oct 14, 2019

Director of Sales Support and Solutions

The Power of Coupons

When it comes to driving and incenting consumer behavior, the coupon continues to be a driving force that connects people to brands, and can act as a purchase trigger. In fact:

  • 74% of consumers review circulars and print ads before making a purchase (Hawk Incentives)
  • 53% of consumers indicated they invest over two hours a week looking for deals and savings across all sources (Valassis)
  • 52% of consumers print out digital coupons for use in stores (Valassis)
  • Free standing inserts (FSI) made up nearly 94% of coupon distribution volume and was the category with the highest redemption volume (NCH Marketing Services)
  • Coupons that appear alone on a page show a 17% higher redemption rate than those sharing an FSI page (NCH Marketing Services)
  • 90% of consumers use coupons, finding them from a variety of online and offline sources (Valassis)
  • 60% of shoppers are influenced by coupons for grocery purchases (NCH Marketing Services)

While clipping coupons is still a favorite activity for many consumers, the industry is seeing a shift in consumer behaviors to include digital media, which is why it’s essential for brands to provide a balance between print mail and digital media. I’m going to evaluate the pros/cons of the different types of coupons, but first, some history…


History of Coupons

How have coupons become such an important part of our shopping experience?  Here is a timeline of the history:


Coupon Options for CPG Food & Beverage Companies:

  • Physical Coupons (Mail): Mail coupons continue to remain a staple in the market. The 2K18 Valassis Coupon Intelligence Report revealed that mail coupon usage increased from 88% in 2017 to 91% in 2018. Additionally, consumers still prefer to receive coupons in the mail, and of those consumers that were shopping for food in grocery stores, 90% redeemed coupons that they received in the mail.


  • Mobile Coupons: This is what most consumers think of when they hear “digital coupons.” However while a true mobile experience is achievable for store-specific coupons, it remains a challenge for CPG manufacturing coupons. This is primarily because manufacturer’s coupons act differently, and have strict rules and industry guidelines that must be followed. Similar to a check, a manufacturer’s coupon, in print format, gets cashed by a third party, and then the CPG manufacturer who issued the coupon provides reimbursement for the cash value. After in-store redemption, the coupon goes through a reconciliation and authentication process. By having a physical paper coupon, there is more control in place in terms of redemption and anticipated reimbursement amounts, which provides the necessary security for all parties. While it appears outdated, the industry is aware of this challenge and working through the roadblocks of a mobile coupon.


  • Print-at-Home Coupons: Consumers can print manufacturer’s coupons, which can be found directly on brand, grocery store or general coupon websites, at home with their personal printer. Valassis found that the path to purchase begins at home, with more than 64% of consumers regularly planning their purchases and maintaining an ongoing shopping list. With this in mind, it makes sense that companies consider “Print-at-home” as a digital resource for shoppers.


  • Load-to-Card: With this retailer-specific option, consumers can load coupon offers to their participating grocery store loyalty cards. Valassis found that 73% of a consumers downloaded discounts to their shopper loyalty cards, and that 39% preferred online discounts that could be downloaded to a store loyalty card.


  • Post-Purchase Apps: The buying process does not end at the point of purchase. Consumers can take advantage of discounts beyond their initial shopping trips, utilizing Rebate & Cash Back Apps, and Receipt Upload Programs. Apps like iBotta offer easy ways to earn, such as submitting receipts after purchase and pre-selecting offers at participating stores. Consumers can redeem the offers by taking a picture of their receipt, where selected offers are matched up against purchases and cash is added to their account. Per Valassis, “53% of consumers scan receipts with a mobile device to receive cash back and/or points, providing an opportunity to increase brand loyalty post purchase.”


Which Coupon Delivery Strategy Is Right for Your Company?


The Bottom Line

According to Valassis, “The modern shopper is dynamic, informed, and on a quest for value.” If your brand’s primary focus is on driving loyalty, coupons and savings-based strategies continue to drive brand loyalty. Coupons will draw customers to your brands, regardless of whether they’re distributed through mail, email, print-at-home, etc. Additionally, coupons – paper and digital – attract attention to new items, driving product growth and boosting brand awareness.

Ultimately, companies who master the balance between print and digital offers can expect enhanced results in a changing CPG environment.



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