CPG Marketers to Emphasize Health and Beauty Product Coupons

A review of the CPG (consumer packaged goods) coupon activity in 2012 could lead analysts to believe that the recession is over. Coupon issuers have tightened up on the value they’re offering and consumers are redeeming fewer coupons. However, this form of marketing remains effective for companies who are seeking to roll out new products.

So far this year, marketing have issued 165 billion coupons which is down by 1.2% from last year. In an interesting trend in 2012, marketers have been releasing more HBC (health and beauty care) coupons and fewer grocery coupons. Grocery comprised 56.4% of the total, down 7.0%, while HBC was 43.6% of the total, up 7.5%.

For now, free-​standing inserts (FSI) remain the format of choice for coupon distribution with 89.7% of the market. The remaining 10.3% are distributed to:

  • Handout  In-​store 4.1%
  • Direct mail 2.0%
  • Magazine 1.8%
  • In/​On Pack Cross-​ruff 1.0%
  • Remaining <2.0%

The average face value for a grocery coupon this year is $1.13 while for HBC it is $2.08. And in order to get the discount, consumers need to make a multiple purchase in 36% of grocery coupons. For HBC that number is 15%.

So far this year, consumers have redeemed 1.55 billion coupons. This marks an 11.4% drop from last year. Not surprisingly, the number of grocery-​related coupons has dropped 12.8% while HBC has dropped on 8.7%. Part of this shift is related to fewer grocery coupons being issued.

For marketers preparing coupons for the rest of the year, it’s important to know which channels are performing well in CPG. For grocery-​related coupons, instant on-​pack (20.1%), Internet home printed (17.3%) and on-​shelf distributed (10.8%) are clear winners. HBC shoppers made top use of instant on-​pack (29.6%), Internet home printed (13.65%), and on-​shelf distributed (7.4%) their favorite redemption methods. But military was also a strong performer and accounted for 5.7% of HBC redemptions.

Whether coupons are losing ground to better economic times or newer trends such as daily deals is hard to say. But the channel remains a solid performer for marketers.

[Source: Mid-​Year 2012 Coupon Facts Report. NCH Marketing Services. 23 Jul. 2012. Web. 3 Aug. 2012] 
Kathy Crosett
Kathy is the Vice President of Research for SalesFuel. She holds a Masters in Business Administration from the University of Vermont and oversees a staff of researchers, writers and content providers for SalesFuel. Previously, she was co-​owner of several small businesses in the health care services sector.