The New York Times reports on the return of the paper coupon, which during recessionary times is being used even by those who normally wouldn’t, such as affluent and young shoppers. Research company Knowledge Networks/PDI estimates that coupon use by affluent families was up 13 percent in January-February 2009, compared with the same months the year before, while coupon use by young people was up 14 percent during the same time frame.
“Coupon redemption in America peaked in 1992,” the Times writes, “at the end of a recession, when 7.9 billion coupons were redeemed, according to Inmar, a coupon processing company. By 2006, that number fell to 2.6 billion and stagnated there through 2008.
“As the economy worsened and consumer sentiment plunged, coupon redemption ticked up 10 percent in the fourth quarter of 2008, compared with the period a year ago — the first jump in coupon redemption since the early 1990s. In the first half of this year, coupon redemption climbed 23 percent. Some 1.6 billion coupons were redeemed, leading Inmar to forecast that more than three billion coupons will be redeemed this year.”
“Coupon redemption in America peaked in 1992,” the Times writes, “at the end of a recession, when 7.9 billion coupons were redeemed, according to Inmar, a coupon processing company. By 2006, that number fell to 2.6 billion and stagnated there through 2008.
“As the economy worsened and consumer sentiment plunged, coupon redemption ticked up 10 percent in the fourth quarter of 2008, compared with the period a year ago — the first jump in coupon redemption since the early 1990s. In the first half of this year, coupon redemption climbed 23 percent. Some 1.6 billion coupons were redeemed, leading Inmar to forecast that more than three billion coupons will be redeemed this year.”
- KC's View:
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This isn’t a huge surprise…in fact, it would be a lot more shocking if coupon use were down during a recession.
The question is whether coupon usage will continue to grow, or even stabilize at these increased levels, if indeed a new frugality takes hold among US consumers that lasts way beyond the end of the recession and a rebound in employment figures. (You have to link the two, since employment is expected to lag the official “end of the recession” by as much as a year.)
I tend to think that where we might see growth will be in targeted coupons/discounts that are delivered in digital form, as opposed to paper coupons that are simply dropped in consumers via FSI. It is hard for me to believe that there is much of a future in this latter category…simply because there is so much waste and so little information known about the shoppers getting the coupons.
