retail news in context, analysis with attitude

Advertising Age has an interesting piece about the complicated relationship that the retail business has with so-called “extreme coupon” users who exploit the system by using coupons so aggressively that they “game the system” and hurt both manufacturers and retailers.

“Retailers are now responding,” Ad Age writes. “Chains are updating their policies, with some adding more restrictions and others posting rules for the first time ... Among those making changes is Target, which has updated its policy to clarify that two buy-one-get-one-free coupons cannot be combined to make both items free. Rite Aid tightened its rules on multiple coupons, specifying that it ‘may accept up to four identical coupons for the same number of qualifying items as long as there is sufficient stock to satisfy other customers.’ Walgreens began posting rules last year, stating that ‘management reserves the right to limit quantity of items purchased.’ Even Publix, a grocery chain known for its lenient coupon rules, issued a formal policy in May.”

On the other hand, retailers “don't want to appear too stingy, for fear of losing business, and are only seeking to keep out the abusers. And in an age where an army of mommy bloggers watch -- and report on -- their every move, one false step can prove fateful.” Supervalu consults with the bloggers, the story says, in order to make informed decisions, and Piggly Wiggly has gone so far as to sponsor talks by “celebrity couponers,” saying that it wants to encourage the use of coupons in its stores, just not the abuse of coupons by a small minority.

Ad Age notes that coupon abuse “is by no means an epidemic. Coupon redemption is relatively flat as of late -- at 3.3 billion redemptions in 2010 -- and is down from the recent peak of 4.4 billion in 2000, according to a report by Nielsen and Inmar. Still, the percentage of consumers who are heavy users, or ‘enthusiasts,’ is on the rise, growing to 13% of all households in 2010, up from 11% in 2009, according to Nielsen. Of all coupons used in 2010, 70% were redeemed by enthusiasts, defined as those who bought at least 188 items in a year using coupons. It is this group that can pose challenges for retailers by tying up lines, clearing shelves and upsetting otherwise predictable supply-demand formulas.”
KC's View:
I have to admit that I simply don’t get the whole extreme couponing thing. It seems to have a lot more to do with satisfying compulsions than saving money ... and there seem to be so many more things that one could be doing with one’s time. But that’s just me.