Wednesday, February 18, 2015

Redemption of Digital Load-to-Card Offers Doubles

Free-Standing Inserts (FSIs) still dominated couponing last year. But digital and electronic coupons are becoming more of a factor in distribution and redemption.

According to a report on 2014 coupon trends from Inmar:

  • Electronic coupons at checkout and print-at-home coupons accounted for 7.3 percent and 3.5 percent of redemption respectively. 
  • Digital paperless Load-to-Card (L2C) coupons doubled their share of overall redemption 1.8 percent,

L2C offers posted their fifth consecutive year of growth in redemption. Grocery retailers that have made these coupons a key feature of their frequent shopper loyalty programs are benefiting. The convenience these offers provide shoppers and the flexibility they afford both retailers and manufacturers is enhancing their position in the marketing mix.
  
Inmar officials say growth has been accelerating significantly for the last several years.

“The one hundred percent, year-over-year, growth we’re continuing to see in redemption for load-to-card coupons is affirmation of their rapidly expanding popularity among consumers and the tremendous utility they provide marketers,” said David Mounts, Chairman and CEO of Inmar, which operates intelligent commerce networks. “The ability marketers now have to personalize these offers, deliver them adjacent to equity-building content and target them to individual shoppers – at scale – makes them particularly effective in building share for brands and maintaining loyalty for retailers.” 

Other major methods capturing a significant share of redemption volume in 2014 included:

  • Instant Redeemable and Instant Redeemable Cross-Ruff  (together 21.6 percent of all coupons redeemed)
  • Shelf Pad (5.4 percent).

Free-Sanding Inserts (FSIs) garnered the largest share of redemption (39.4 percent) of the 2.84 billion coupons redeemed in 2014. They accounted for the majority (89.6%) of the 319 billion coupons distributed last year. These coupons included offers for both food and non-food items and were distributed digitally as well as through traditional paper methods. 

Overall coupon distribution declined slightly (-2.9%) compared to 2013, while redemption was also down slightly (-3.0%) during the same period.

While 2014 coupon distribution strategies stayed consistent with recent past practice, Inmar said marketers are continuing to experiment with offer attributes as they seek to find the best “formula” for motivating acquisition and driving redemption.  They are employing multiple methods and higher face values to help drive redemption.

Average face values for distributed food and non-food offers were up to $1.15 (an increase of 11.6 percent) and $2.04 (an increase of 6.2 percent), respectively. However, marketers gave consumers less time to take advantage of these higher face values with the average redemption period for all offers continuing its contraction to 2.0 months, a decrease of 7.2 percent compared to 2013.

Inmar, based in Winston-Salem, N.C., processes and analyzes more than 2.3 billion coupons and related campaigns annually, providing an expertise in planning, executing and measuring promotions. In addition to providing promotion management, coupon processing, business intelligence and analytics, Inmar monitors coupon distribution and redemption across the country and regularly reports on trends and activity in this sector.

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