Winston-Salem, NC (PRWEB) August 04, 2016
Inmar Inc.’s Promotion Industry Analysis for H1 2016 finds that even as digital coupons are creating a 10x impact in redemption activity relative to share of overall distribution, traditional paper coupons (in the form of Free-standing Inserts or “FSIs”) continue to dominate the industry. FSIs comprised 90.6 percent of the coupons distributed in the first six months of the year, while digital coupons (paperless load-to-card and print-at-home) accounted for just 0.6 percent – but garnered 6.7 percent of total coupon redemption volume for the period.
Although digital coupons continue to “punch above their weight,” marketers remain largely reliant on FSIs despite an average redemption rate of 0.34 percent (H1 2016). By comparison, load-to-card and print-at-home coupons had average redemption rates of 5.82 percent and 12.14 percent, respectively. Bolstered by disproportionate distribution, FSIs accounted for just over a third of coupons redeemed during the period.
The popularity of digital promotions has been climbing steadily as shoppers become more digitally dependent and more demanding of easier and faster ways to save on their grocery bills. This convenience requirement is proving to be of even greater importance to marketers as improved economy conditions are making it more difficult to engage consumers through coupons.
“Shoppers’ expectations of greater convenience and more immediate access to relevant offers are creating both opportunities and challenges for marketers,” says Inmar Chairman and CEO David Mounts. “It appears that the accelerated adoption of digital promotions by shoppers has caught some manufacturers by surprise and while some have responded by making more of these types of offers available, many are still challenged to keep up with increasing shopper demand,” adds Mounts.
As for the overall availability of offers, 169 billion manufacturer-funded coupons were distributed during the first six months of 2016 -- a reduction of 2.5 percent compared to the same period last year. Of the offers in circulation, 1.2 billion were redeemed (down 4.4% compared to H1 2015). However, this drop-off in redemption – reported during Inmar’s recent Mid-year Promotion Industry Analysis webinar – speaks to an improving situation and marks a slowing of the decline in coupon redemption noted at the end of last year.
Inmar’s ongoing analysis of promotion industry data has shown the unemployment rate to be a statistical bellwether of coupon use; typically, as the jobless numbers rise and fall so does coupon redemption. With the unemployment rate falling more slowly than in past years, the result has been a slowing of the decline in coupon redemption.
While an increase in distribution for coupons for food products – which typically redeem at a higher rate – also contributed to the deceleration, lower average face values (down 7.1% vs. H1 2015) and higher average purchase requirements (up 6.9% vs. H1 2015) negatively impacted what might have been an even greater reversal in recent redemption trends.
Inmar has been in the promotions industry for more than 35 years and currently processes and analyzes more than 2.3 billion coupons and related campaigns annually. In addition to providing promotion program management, coupon processing and advanced analytics, Inmar closely monitors coupon distribution and redemption in the U.S. and Canada and regularly reports on trends and activity in this sector. Research and reporting on promotions and shopper behavior can be accessed on-demand at the Inmar Insights Marketplace.
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Anyone who has redeemed a coupon, filled a prescription or returned a product, has touched Inmar. We apply technology and data science to improve outcomes for consumers and those who serve them. As a trusted intermediary for over 35 years, we have unmatched access to billions of consumer and business transactions in real time. Our analytics, platforms and services enable engagement with shoppers and patients, and optimize results.