Wednesday, September 19, 2012

Double Coupons Fading as Promo Tactic In Favor of Digital Offers

Double coupons are fading from the marketplace. The latest evidence comes from California where grocery chains Vons and Ralphs recently discontinued their policy of doubling the discounts that brand manufacturers provide on paper coupons. While there aren’t hard statistics to back up the trend, knowledgeable coupon experts recognize a change in tactics.   

“There is less ‘bonus couponing’ across the U.S. today than there was years ago,” reports Charles Brown, Vice President, Marketing for NCH Marketing Services, a Valassis Company 

“Grocers are moving away from the non-targeted, non-customer-specific type promotions like double coupons,” reports Richard Thibedeau, Executive Vice President of Operations for Intelligent Clearing Network, which electronically validates and clears paper and digital coupons in real time at the POS in grocery, drug and mass merchant retailers 

Some supermarkets in competitive markets have doubled coupons for years as a way to keep loyal shoppers or to lure them away from other stores. Retailers often have limits on such programs, such as a specific day of the week, only up to a specified value, excluding coupons distributed in the store, or excluding specific product categories. Retailers pay for the amount they double coupons for. Manufacturers will reimburse them only for the face value of the coupon. 

“Double coupons are no longer giving some stores enough of an edge that it’s prudent for them to continue the program,” says Rachel Singer Gordon, a coupon analyst and author of The Complete Idiot’s Guide to Couponing, “Sometimes, in order to afford double coupons, stores end up needing to increase overall prices to make up for the double coupon costs they are eating. This makes them less competitive to non-couponers or casual couponers, compared to neighboring grocers. This gives the perception that their prices are high and gives an edge to the low-cost competitors popping up all over. 

“Supermarkets are feeling the pinch of the extended economic downturn as well as increased competition from everyone from Walmart to dollar stores,” she goes on to say. “They have to take a hard look at where to cut costs. As they watch competitors discontinue double coupons with few long-term repercussions, this provides them an incentive to follow suit. We’ll probably see this trend continuing in the foreseeable future.”

If that’s the case, won’t consumers leave stores that discontinue double coupons and shop where they still double? 


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