It’s clear that consumers continue to feel the effects of the recession.
Livonia, Mich. (Vocus) April 21, 2010
Valassis (NYSE: VCI), one of the nation’s leading media and marketing services companies, announced today that coupon distribution and redemption continued to increase significantly in the first quarter of 2010. This increase builds on record-setting growth announced for 2009. These findings were revealed as part of a Coupon Market Quarterly Update recently released by NCH Marketing Services, Inc., a Valassis company.
Consumer Packaged Goods (CPG) coupon distribution in the United States grew 14.1% in the first quarter of 2010 compared to the same period a year ago (approximately 10% without the timing effect of pre-Easter holiday promotions in the first quarter of 2010). In total, 89 billion coupons were distributed, outpacing the average quarterly volume in 2009 by an incremental 11 billion coupons offered to consumers.
Similarly, redemption increased by 9.7% compared to the first quarter of 2009. Consumers redeemed 850 million coupons in the first quarter of 2010. The sustained growth in coupon redemption volume produced the sixth consecutive quarter reflecting increased usage.
“It’s clear that consumers continue to feel the effects of the recession,” said Charlie Brown, NCH Vice President of Marketing. “It is influencing the way they shop, and it has contributed to making coupons an even more integral part of consumers’ buying decisions.”
Brown also said that while many economists are pointing to positive indications of economic improvement and some have even said they believe the recession ended months ago, the coupon marketplace trend indicates that marketers aren’t taking any chances with their need to deliver results.
“Two primary drivers will impact the year ahead for coupons – marketers and consumers,” said Suzie Brown, Valassis Chief Marketing Officer. “A change in the consumer mindset toward value is clear and evidenced by the increased redemption rates and the numerous studies focusing on shopping behaviors. Marketers are taking note of this phenomenon as they continue to appeal to the savvy shopper who has come to expect great deals. Consumers are now routinely making their shopping decisions with coupons.”
Valassis is one of the nation’s leading media and marketing services companies, offering unparalleled reach and scale to more than 15,000 advertisers. Its RedPlum media portfolio delivers value on a weekly basis to over 100 million shoppers across a multi-media platform – in-home, in-store and in-motion. Through its interactive offering – redplum.com – consumers will find compelling national and local deals online. Headquartered in Livonia, Michigan with approximately 7,000 associates in 28 states and eight countries, Valassis is widely recognized for its associate and corporate citizenship programs, including its America’s Looking for Its Missing Children® program. Valassis companies include Valassis Direct Mail, Inc., Valassis Canada, Promotion Watch, Valassis Relationship Marketing Systems, LLC and NCH Marketing Services, Inc. For more information, visit http://www.valassis.com or http://www.redplum.com. To learn about advertising opportunities with RedPlum, please call 1-800-437-0479.
Cautionary Statements Regarding Forward-looking Statements
Certain statements found in this document constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Such forward-looking statements involve known and unknown risks and uncertainties and other factors which may cause our actual results, performance or achievements to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Such factors include, among others, the following: price competition from our existing competitors; new competitors in any of our businesses; a shift in client preference for different promotional materials, strategies or coupon delivery methods, including, without limitation, as a result of declines in newspaper circulation; an unforeseen increase in paper or postal costs; changes which affect the businesses of our clients and lead to reduced sales promotion spending, including, without limitation, a decrease of marketing budgets which are generally discretionary in nature and easier to reduce in the short-term than other expenses; our substantial indebtedness, and ability to refinance such indebtedness, if necessary, and our ability to incur additional indebtedness, may affect our financial health; the financial condition, including bankruptcies, of our clients, suppliers, senior secured credit facility lenders or other counterparties; our ability to comply with or obtain modifications or waivers of the financial covenants contained in our debt documents; certain covenants in our debt documents could adversely restrict our financial and operating flexibility; ongoing disruptions in the credit markets that make it difficult for companies to secure financing; fluctuations in the amount, timing, pages, weight and kinds of advertising pieces from period to period, due to a change in our clients’ promotional needs, inventories and other factors; our failure to attract and retain qualified personnel may affect our business and results of operations; a rise in interest rates could increase our borrowing costs; we may be required to recognize additional impairment charges against goodwill and intangible assets in the future; court approval of the settlement agreement among the parties to the pending ADVO securities class action lawsuit; possible governmental regulation or litigation affecting aspects of our business; the credit and liquidity crisis in the financial markets could continue to affect our results of operations and financial condition; uncertainty in the application and interpretation of applicable state sales tax laws may expose us to additional sales tax liability; and general economic conditions, whether nationally, internationally, or in the market areas in which we conduct our business, including the adverse impact of the ongoing economic downturn on the marketing expenditures and activities of our clients and prospective clients as well as our vendors, with whom we rely on to provide us with quality materials at the right prices and in a timely manner. These and other risks and uncertainties related to our business are described in greater detail in our filings with the United States Securities and Exchange Commission, including our reports on Forms 10-K and 10-Q and the foregoing information should be read in conjunction with these filings. We disclaim any intention or obligation to update or revise any forward-looking statements, whether as a result of new information, future events or otherwise.
Director, Investor Relations and Corporate Communications