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Second Quarter Coupon Trends Update July 25, 2012
Matthew Tilley Director of Marketing, Promotions Network
® © 2012 Inmar, Inc. All Rights Reserved. Not to be reproduced or distributed without written permission from Inmar
Network Orchestrator of Complex Transactions
2
We operate collaborative commerce networks and make them intelligent.
• Reverse Logistics • Remarketing • Transportation • Donation • Recalls • Hazardous
Material/Waste • Consulting • Value-Added Services • Business Intelligence
• Rx Returns • Medical Device • Hazardous • Material/Waste • Recalls • Reconciliation • Contract
Management • Value Added Services • Business Intelligence
• Digital Promotions • Coupons • Rebates • Promotion Consulting
® © 2012 Inmar, Inc. All Rights Reserved. Not to be reproduced or distributed without written permission from Inmar
© 2012 Inmar, Inc. All Rights Reserved. Not to be reproduced or distributed without written permission from Inmar
Where we’re going
• The Big Numbers • The Four Contributing Factors • Two Important Notes
–Counterfeit Coupons –Digital Promotions
• Your Questions
3
® © 2012 Inmar, Inc. All Rights Reserved. Not to be reproduced or distributed without written permission from Inmar
Long-term Trend: Redemption Growth
4
2006 2.6 billion
2009 3.3 billion
2011 3.5 billion
growth rate! Source: Inmar Coupon Report 2012
® © 2012 Inmar, Inc. All Rights Reserved. Not to be reproduced or distributed without written permission from Inmar
Redemption The Big Story
5
-11% H1 2012
vs. H1 2011
-7% Q1 -17% Q2
Source: Inmar Coupon Report 2012
® © 2012 Inmar, Inc. All Rights Reserved. Not to be reproduced or distributed without written permission from Inmar
Redemption Declines Across the Board
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Non-food Food -4.9% Decline
-11.0% Decline
Q1
Q2
H1
-16.3% Decline
-18.5% Decline
-10.7% Decline
-15.3% Decline
Source: Inmar Coupon Report 2012
® © 2012 Inmar, Inc. All Rights Reserved. Not to be reproduced or distributed without written permission from Inmar
ALL Major Methods See Redemption Declines
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Share of Redemption Redemption Volume
Change
Free-standing Insert 46.8% -14%
Instant Redeemable 16.4% -21%
Electronic Checkout 8.7% -13%
Shelf Pad 5.7% -32%
Direct Mail 4.1% -8%
Internet 4.0% -24%
Handout 3.0% -11%
On-pack 2.6% -14%
In-pack 2.3% -29%
Electronic Shelf 1.5% -32% Source: Inmar Coupon Report 2012, Q2 data only
® © 2012 Inmar, Inc. All Rights Reserved. Not to be reproduced or distributed without written permission from Inmar
© 2012 Inmar, Inc. All Rights Reserved. Not to be reproduced or distributed without written permission from Inmar
Four Contributing Factors
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Promotion Support Pullback
Unattractive Offers
Private Label
Unemployment
® © 2012 Inmar, Inc. All Rights Reserved. Not to be reproduced or distributed without written permission from Inmar
-14-12-10
-8-6-4-202468
% Change Unit Price % Change Any Promo Unit Volume
CPG prices up & promotion support down All Departments 30 periods of price gains;
3.6% increase in latest period
Source: Nielsen Scantrack, Total U.S. All Outlets Combined; 4 week increments (vs. prior year); UPC-coded
® © 2012 Inmar, Inc. All Rights Reserved. Not to be reproduced or distributed without written permission from Inmar
Distribution Continues to Fall Distribution
-3.0% H1 2012
vs. H1 2011
10
-1.5% Q1 -7.1% Q2
Source: Inmar Coupon Report 2012
® © 2012 Inmar, Inc. All Rights Reserved. Not to be reproduced or distributed without written permission from Inmar
Distribution Declines Across the Board
Non-food Food
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-1.9% Decline
-3.8% Decline
Q1
Q2
H1
-7.1% Decline
-7.1% Decline
-2.0% Decline
-3.6% Decline
Source: Inmar Coupon Report 2012
® © 2012 Inmar, Inc. All Rights Reserved. Not to be reproduced or distributed without written permission from Inmar
Many Major Methods See Distribution Declines
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Share of Redemption
Redemption Volume Change
Distribution Volume Change
Free-standing Insert 46.8% -14% -5%
Instant Redeemable 16.4% -21% +6%
Electronic Checkout 8.7% -13% +23%
Shelf Pad 5.7% -32% +9%
Direct Mail 4.1% -8% +62%
Internet 4.0% -24% -54%
Handout 3.0% -11% -40%
On-pack 2.6% -14% -58%
In-pack 2.3% -29% -59%
Electronic Shelf 1.5% -32% -6%
Source: Inmar Coupon Report 2012, Q2 data only
® © 2012 Inmar, Inc. All Rights Reserved. Not to be reproduced or distributed without written permission from Inmar
© 2012 Inmar, Inc. All Rights Reserved. Not to be reproduced or distributed without written permission from Inmar
Four Contributing Factors
13
Promotion Support Pullback
Unattractive Offers
Private Label
Unemployment
® © 2012 Inmar, Inc. All Rights Reserved. Not to be reproduced or distributed without written permission from Inmar
Distributed:
$1.47/coupon (-9.3%)
Redeemed:
$1.28/coupon (+0.8%)
Distributed:
1.53 units/coupon (+2.7%)
Redeemed:
1.69 units/coupon (+1.8%)
Distributed: 2.1 months
(-12.5%)
Redeemed: 5.0 months
(-7.4%)
Marketer Tactics Are Muting Redemption
Average Face Value
Average Purchase Requirements
Average Redemption
Periods
14 Source: Inmar Coupon Report 2012, Q2 data only
® © 2012 Inmar, Inc. All Rights Reserved. Not to be reproduced or distributed without written permission from Inmar
© 2012 Inmar, Inc. All Rights Reserved. Not to be reproduced or distributed without written permission from Inmar
Four Contributing Factors
15
Promotion Support Pullback
Unattractive Offers
Private Label
Unemployment
® © 2012 Inmar, Inc. All Rights Reserved. Not to be reproduced or distributed without written permission from Inmar
© 2012 Inmar, Inc. All Rights Reserved. Not to be reproduced or distributed without written permission from Inmar
CPG Price Increases Due to Continue
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2.5% - 3.5%
“Food At Home” Inflation
2012 Forecast
Source: USDA
® © 2012 Inmar, Inc. All Rights Reserved. Not to be reproduced or distributed without written permission from Inmar
Private Brands
14%growth rate!
2009 $94 billion
2012 $107.1 billion
Source: Nielsen Scantrack, Total U.S. – All Outlets Combined; 52 weeks ending 12/26/2009 & 6/9/2012; UPC-coded
® © 2012 Inmar, Inc. All Rights Reserved. Not to be reproduced or distributed without written permission from Inmar
© 2012 Inmar, Inc. All Rights Reserved. Not to be reproduced or distributed without written permission from Inmar
Four Contributing Factors
18
Promotion Support Pullback
Unattractive Offers
Private Label
Unemployment
® © 2012 Inmar, Inc. All Rights Reserved. Not to be reproduced or distributed without written permission from Inmar
Unemployment Rates (Slightly) Improving
19
® © 2012 Inmar, Inc. All Rights Reserved. Not to be reproduced or distributed without written permission from Inmar
+5%
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Where is all of this going?
• Distribution still down • Redemption down 5-10%
by year’s end
For more information:
Matthew.Tilley@inmar.com 336.631.2524 www.inmar.com/couponreport @matthewjtilley
Matthew Tilley
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