Consumers are using fewer coupons on their daily purchase this year


Consumers are using fewer coupons on their daily purchases the first half of this year comparing with the same period of last year, majorly because people have found more jobs to pay the bills and manufactures are cutting back their coupon promotions, according to a report released by a coupon processing company.

The coupon redemption rate has dropped by 11 percent this year, according to the marketing director Mathew Tilley of Inmar, which processes 45 percent of  the coupon transactions between manufactures who issue coupons and retailers who redeem them in the U.S..

The coupon redemption rate,on a certain level, is a reflection of  the well-being of the U.S. labor market. Tilley said that during the recession 70 percent of the change in the coupon redemption rate was related with the change in the unemployment rate.

“When people go out of work, people turn to coupons more often, and vice versa happens”, Tilley said.

The U.S. unemployment rate was around 9 percent the first half of 2011 and it has been between 8 and 8.5 percent so far this year. It is expected to continue to drop slowly, according to Ken Goldstein, economist at Conference Board, a private think tank company.

“It is going to drop, but not drop like a stone”, said Goldstein. Inmar predicts the drop in coupon redemption rate will be around 5 to 10 percent for this year.

Another reason why people are using fewer coupons is because there are fewer ones out there on the market from manufactures.

Manufactures have distributed 5 percent fewer coupons so far this year and the decrease are seen both for the clip coupons and the digital ones.

The number of coupons redeemed jumped by 0.2 billion from 2009 to 2011 to induce consumer spending, but now companies are trying to gain back the profit lost on promotions during the recession.

“Marketers are pulling back their effort trying to make sure their offers don’t over-redeem, and they want to understand and manage the cost and the risk they have”, says Tilley.

Some companies are doing this as a sales strategy, said Michael Cohen, a professor of marketing at the New York University. For example, J.C.Penny Company,Inc eliminated the usage of coupons altogether this February, intending to attract consumers with low prices rather than coupons, said Cohen.


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