Retailer promotion activity increased 11.2 percent to more than 9.3 billion pages
MINNEAPOLIS, MN July 11, 2012 – Free Standing Insert (FSI) coupon activity decreased 1.2 percent based on Coupons Dropped during the first six months of 2012 versus the same time period a year ago according to Marx, a Kantar Media solution. “FSI coupons continue to be an effective advertising vehicle for brand marketers and retailers to reach shoppers in the home where they are writing shopping lists and planning shopping trips,” said David Hamric, General Manager, Marx. “As FSI coupon redemption rates have increased, manufacturers are reducing their financial exposure by distributing fewer coupons at lower face values and shorter expiration periods. However, FSI coupon vehicles continue to deliver significant advertising impact and retailer merchandising opportunities based on their ability to reach millions of households on a specific day,” concluded Hamric.
Kantar Media, the industry standard for tracking FSI coupon activity, also reports that retailer promotion activity continued to grow with an 11.2 percent increase to 9.3 billion pages in the first half of 2012. Walmart continued to lead in retailer activity followed by Walgreens which moved to second from a rank of fourth in 2011. Six of the top 10 retailers increased Pages Circulated during the first half of 2012 versus the same period a year ago.
“Retailers may gain a competitive advantage by participating in retailer FSI promotions to capture a greater share of shopping trips among households that use coupons,” said David Hamric. “For consumers, coupons are a proven way to save money on a specific item. For retailers, coupons can increase the overall retail value of each shopping trip by adding more items to the shopping basket and increasing the budget by the value of the coupons. Through Kantar Media’s new DirectHEAT® service for retailers, our clients are able to identify how competitive brands are aligning with retailer advertising and promotion programs during key weeks to drive trips, transactions, and profits,” concluded Hamric.
Overall FSI Activity
During the first half oupon Average Face Value declined by 3.2 percent to $1.53 for the first half 2012. Average Expiration (Fuse) dropped to 7.5 weeks, down 9.2 percent versus a year ago which is the fourth consecutive year of declining Fuse lengths during the first half of the year.
Sector Activity
The CPG sector remains the largest user of FSI pages with a 74.3 percent share, followed by Direct Response, which includes general advertising activity, and Franchise, comprised of restaurants, portrait studios, and other businesses. Direct Response had the largest percent decrease; down 6.8 percent to more than 17.3 billion pages, while Franchise reported the only increase, up 9.5 percent to more than 11.2 billion pages. CPG remained flat at 82.5 billion pages.
Top 10 Retailers based on Pages Circulated
Retailer promotion pages increased 11.2 percent to more than 9.3 billion pages in the first half of 2012. The number of manufacturers participating in retailer promotion declined 19.2 percent to 232 while the number of retailers increased 3.6 percent to 116. Retailers from Mass (Walmart, Target), Value (Family Dollar, Dollar General), Drug (Walgreens, CVS), and Pet Specialty (PETsMART) comprised the top seven positions. Kroger, Safeway and Publix were the leading Food retailers and were ranked 8th, 9th and 10th respectively.
Walmart continued to hold the top spot based on number of Pages Circulated with an increase of 81.7 percent to 2.5 billion pages which was the largest actual increase among the top 20 retailers. PETsMART had the largest actual decline in Pages Circulated among the top 20, down 47.3 percent in the first half of 2012. H-E-B jumped from a rank of 27 in the first half of 2011 to a rank of 16 in the first half of 2012, which was the largest leap in rank among the top 20 retailers. Family Dollar more than doubled the number of Pages Circulated to rank 4th in the first half of 2012. These trends reflect the overall growth of retailer promotion within traditional FSI vehicles to drive trips, transactions, and profits across channels and retail formats.
Top 10 Categories for New Product Activity
During the first half of 2012, there were 204 new products that delivered FSI coupons compared to 132 new products during the same period in 2011. Event dates increased from 208 to 312 and the total number of categories participating in new product activity increased from 52 to 75. The average number of event dates for a new product launch saw only a 4 percent decline from 1.6 per new product to 1.5.
CPG Non-Food vs. Food
In the first half of 2012, Non-Food categories distributed more than 91.8 billion coupons, up 4.2 percent versus the same time period in 2011, while Food categories distributed 56.4 billion coupons, representing a decrease of 9.0 percent. Within Non-Food, the Personal Care area had the largest actual increase in Coupons Dropped while within Food; the Shelf Stable Beverages area reported the only increase, up 20.8 percent.
Additionally, manufacturers are decreasing the value of the offers that are being delivered to consumers in both the Non-Food and Food segments. Weighted Average Face Value (WAFV) for Non-Food decreased 6.4 percent to $1.84 and was combined with a 0.1 point increase in Multiple Purchase Requirements (MPR) resulting in Weighted Average Face Value Per Unit (WAFVPU) decreasing 5.9 percent to $1.61. WAFV for Food decreased 0.8 percent to $1.03 and was combined with a 2.8 point increase in MPR resulting in WAFVPU declining 5.0 percent to $0.74.
Top 10 FSI Product Types in First Half 2012 (by Coupons Dropped*)
The top 10 product types based on Coupons Dropped accounted for 37.4 percent of all FSI coupon activity during the first half of 2012. Combination/Personal products (a group of products which have extensions that cross multiple Personal Care categories) ranked first and increased 5.5 percent to distribute more than 7.5 billion coupons. Pet Food & Treats dropped to second place with a 19.5 percent decrease to 6.9 billion coupons. Bar/Liquid Soap moved into the top 10 having moved up one spot from a rank of 11 to 10 with a 13.8 percent increase to 3.6 billion coupons.
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Kantar Media provides strategic advice and competitive intelligence to the world’s leading brands, publishers, agencies and industry bodies, helping them navigate and succeed in a rapidly evolving media industry. This includes analysis of paid media opportunities; counsel on brand reputation, corporate management and consumer engagement through owned media; and, evaluating consumers’ reactions in earned media. Kantar Media provides clients with a broad range of insights from audience research, competitive intelligence, vital consumer behavior and digital insights, to marketing effectiveness and online influence. Our experts currently work with 22,000 companies tracking 3 million brands in 50 countries. www.KantarMediaNA.com