WII MASH-UP: Coupons A Big Hit Especially With Online & Affluent Consumers

In this mash-up:

• Coupon Use Continues Resurgence
• Coupon Enthusiasts Drive Up Redemption Rates
• Which Is More Effective – Print or Online Coupons?
• Valpak iPhone Ap delivers coupon savings on-the-go

Summary: While few wine brands actually use coupons, multiple studies show that coupons are a direct path to consumers’ wallets. Further, online coupons are proving to be even more effective sales tools.

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Coupon Use Continues Resurgence

Nielsen, Nov. 6, 2009 — From:  http://blog.nielsen.com/nielsenwire/consumer/coupon-use-continues-resurgence/

Although economic recovery finally seems to be taking root in the U.S., consumers remain cautious when it comes to spending their money. And many analysts believe that shopping behavior that has changed during the recession is permanent. One factor backing up that premise is the continued upswing in coupon use after years of declines.

As we previously noted, consumers have re-embraced coupons as a way to get more for their money. In the third quarter, year-to-date coupon redemption was up 26 percent to 2.4 billion redemptions, making it the fourth consecutive quarter of growth, according to new research from Inmar in collaboration with The Nielsen Company. During 2006-2008, coupon redemption stagnated at 2.6 billion each full year. Inmar, which provides logistic management solutions to retailers, wholesalers and manufacturers in the consumer goods and healthcare markets, is forecasting that 3.2 billion coupons will be redeemed this year, marking a significant increase over recent years.

But while food coupons have typically driven activity, non-food coupons for general merchandise, household items and personal care drove growth in the third quarter, up 45 percent over the same period last year (food items were up 26 percent over the same period last year). While supermarkets remain the traditional coupon redemption channel, representing 64 percent of redemptions, the dollar/discount/variety and mass merchandiser channels are up at a faster rate.

“It’s clear that coupons have increasingly become an important way for consumers to save some money when shopping. Digital coupons are driving a huge increase in redemptions but still represent a small percentage of distributed and redeemed coupons. Meanwhile, freestanding inserts account for almost 90 percent of distributed coupons, but just over half of redeemed coupons,” said Todd Hale, Senior Vice President, Consumer and Shopping Insights at Nielsen. “Moreover, coupon enthusiasts buy more products per trip and generally have a higher spend per trip in the grocery and supercenter channels. The fact is, coupons can yield a significant return on investment, and savvy consumer goods manufacturers should seriously consider how they may be able to play a role in driving sales.”

Coupon Enthusiasts Drive Up Redemption Rates

Nielsen: Sept. 9, 2009 — From: http://blog.nielsen.com/nielsenwire/consumer/coupon-enthusiasts-drive-up-redemption-rates/

Coupon enthusiasts are the driving force behind exploding redemption rates, according to new findings from Nielsen’s Homescan.

Eighty-one percent of the units purchased using manufacturer coupons came from just 19 percent of U.S. households during the twenty-six week period ended June 27, 2009.

The most avid users, called “coupon enthusiasts,” are households that purchased 104 or more items using manufacturers’ coupons. The 10 percent of shoppers that fall into this category accounted for 62 percent of manufacturers’ coupon units. They also accounted for 16 percent of total unit sales making them a very attractive and important consumer target.

Still, the recession is driving heavier coupon usage among all types of consumers as many lighter users have become heavier users. After three quarters of declines in 2008, coupon redemptions spiked 10 percent in Q4 2008, per Inmar. This was followed by a 17 percent increase in Q1 2009 and a 33 percent surge in Q2. This tally includes FSI’s, on-pack offers and Internet coupons but excludes retailer coupons.

Inmar also reported that more and more consumers are using coupons for both food and non-food items. In Q4 2008 non-food redemptions were -3 percent. However, in the second quarter of this year redemptions for non-food items were up 46 percent. Food coupon redemptions were +21 percent in Q4 2008 and increased 27 percent in the second quarter of 2009.

“Without question, coupon usage is undergoing a renaissance,” said  Todd Hale, Senior Vice President, Consumer and Shopping Insights for Nielsen. “More consumers are looking for value and lower prices as retailers and manufacturers are distributing more coupons and making it easier for consumers to leverage technology to access coupons they want with less effort.” Overall, 1.6 billion coupons were redeemed in the first half of 2009.

“These findings from Nielsen suggest that the increased coupon usage we’ve seen this year not only helped consumers stretch their budgets but also provided meaningful sales impact to manufacturers and retailers,” said Inmar’s Matthew Tilley, Director of Marketing. “Coupons have always been an effective way to encourage trial and repeat purchase and are proving to be a bright spot in an otherwise dreary economic environment.”

Which Is More Effective – Print or Online Coupons?

Neurofocus & Nielsen, May 2009 — From: http://en-us.nielsen.com/main/insights/consumer_insight/may_2009/which_is_more_effective

The results of the first research that examines consumer responses to coupons at the deep subconscious level of the brain were revealed by NeuroFocus, the world’s leading neuromarketing company. The findings carry significant implications for marketers as coupon use accelerates across many demographics.

NeuroFocus’ study analyzed consumers’ brainwave activity and combined those findings with eye tracking and galvanic skin response measurements to arrive at results that reveal how print and online coupons fared with regards to attention, emotionalengagement and memory retention. In addition, three additional Market Performance Indicator metrics measured purchaseintent, noveltyand awareness.

Online coupons have stronger appeal than print
The research shows that across the board, the online version of a coupon outperformed the print version, by wide margins in almost every one of the neurometrics categories. Only in Memory Retention were the two coupon types close, and even there the online version still held an advantage.

NeuroFocus Key NeuroMetrics:
(Ranked on a 0-10 scale, where a difference of +/- 0.2 is significant)

	Attention	Emotional Engagement	Memory Retention
Print:	5.5	5.6	7.4
Online:	7.1	6.9	7.6

NeuroFocus combined the Key NeuroMetrics figures to develop an overall Neurological Effectiveness score, and the online coupon beat the print version by a large differential:

	Effectiveness
Print:	6.2
Online:	7.0

NeuroFocus Market Performance Indicator Scores:
(Ranked on a 0-10 scale, where a difference of +/- 0.2 is significant)

	Purchase Intent	Awareness	Novelty
Print:	7.2	6.3	7.1
Online:	7.9	7.6	8.0

Online coupons correspond more strongly with “savings”
NeuroFocus tested for consumers’ subconscious responses to two key coupon-related messaging concepts— “convenient” and “savings” using a rankings scale of High/Strong/Moderate/Mild/Low/None). The brainwaves and biometrics test results scored print and online coupons as even in the “convenient” category with a mild ranking. But the “savings” category showed online coupons gaining another major advantage:

	Savings
Print:	Moderate
Online:	Strong

Reversing the results for print to prevail
NeuroFocus’ research revealed a potentially powerful avenue for print coupons to overtake the online alternative, however. The company created a new “branded element” and added it to both print and online coupons, to determine if the addition would have any effect on consumers’ subconscious responses. The results were striking.

When this new branded element—which NeuroFocus is keeping proprietary for competitive reasons—was included in both versions, the overall Effectiveness score was virtually reversed. With this new element, consumers preferred the print coupon over the online version by almost the same margin that the earlier test had produced for online over print:

	Attention	Emotional Engagement	Memory Retention
New branded element/Print:	6.4	6.6	8.2
New branded element/Online:	6.5	5.6	6.8

	Effectiveness:
New branded element/Print:	6.9
New branded element/Online:	6.0

This new branded element also produced the highest scores of all in several individual categories, including the critically important Memory Retention, Purchase Intent, and Novelty sectors.

	Purchase Intent	Awareness	Novelty
New branded element/Print:	8.0	7.3	8.7
New branded element/Online:	6.3	6.0	7.2

“Our research gives companies the first clear understanding of how consumers respond to coupons where it really counts: deep inside their subconscious minds,” said Dr. A. K. Pradeep, Chief Executive Officer of NeuroFocus. “Neuroscience has proven that that is the level where product interest, purchase intent, and brand loyalty are really formed.”

“The fundamental difference between this research and others is that measuring brainwave responses results in factual findings, not interpretations of what consumers say they think or feel about coupons, “ Dr. Pradeep said. “As our Chief Science Advisor Dr. Robert Knight, one of the world’s preeminent neuroscientists, explains, ‘the brain makes behavior.’ With these results, companies now know the critical differences in subconscious responses across the categories that determine behavior, so they can make the most fully-informed strategic marketing decisions when it comes to couponing.”

Definitions:
Key NeuroMetrics:
Attention: the degree of cognitive interest
Emotional Engagement: the degree of affective response
Memory Retention: The degree of memory encoding and learning involved

Market Performance Indicators:
Purchase Intent: The degree to which purchase/viewing intent has been formed
Awareness: The degree of messaging comprehension and understanding
Novelty: The ability to stand out in the clutter; and form defenses against competitive messages.

Valpak iPhone Ap delivers coupon savings on-the-go

Valpak, Oct. 6, 2009 — From: http://www.coxtarget.com/PR/PR_100609_IPhoneApp.html

iPhone and iPod touch users can now access money-saving coupons using the free Valpak App from the App Store, making saving easier than ever. And just like you’d expect from a company known for savings, it’s a free download. The cost is zero. Nada. Zilch.

“It’s just one more way that Valpak makes it easier for consumers to save,” said Greg Bicket, president of Cox Target Media, which owns Valpak. “These new app permits instant gratification as well as instant point of purchase redemption of Valpak coupons,” said Bicket.

Users of the Valpak app can:

• Access to more than 17,000 offers
• Search savings by categories of dining, auto, beauty, health, shops, leisure, home, professional and general
• Use your phone’s GPS to locate savings around you
• Results are automatically sorted by distance
• Click on a coupon and you can use phone’s mapping function to get directions
• View multiple discounts
• Tap business phone numbers making it easy to call for more information

The Valpak App is available for free from the App Store on iPhone and iPod touch or at www.itunes.com/appstore/.

“Valpak is making sure we are in the consumers’ back pocket,” said Jim Buckley, director of the new media business development team at Valpak. “Consumers appreciate finding new local businesses and savings through Valpak.com. This gives them one more way to save,” said Buckley, who oversaw the development team. “People appreciate easy ways to get a good deal whether they’re at work, at home, or even out running errands. In addition, this is a tremendous benefit for Valpak.com advertisers because they can now connect to the growing mobile couponing medium to bring more customers in the door. Taking this step was important for our business.”

Since 1998, the company has offered Valpak.com, which has 20 million views per month, and gives consumers a way to print coupons they need, exactly when they need them. For 41 years, consumers have looked for value in the blue Valpak envelope. Each year, 20 billion offers are sent to 45 million homes across North America.