Globally, online consumers of all ages reported that receiving discounts and special offers was their top reason for liking or following brands.  Only respondents under the age of 20 and 55-59-year-olds were less likely to follow for this reason, reporting they primarily engage with brands via social media based on friends’ recommendations.

While some may argue that consumers’ interest in discounts has faded, Nielsen data shows the desire for deals is still strong worldwide.  Across a sample of ten major markets*, nearly 40 percent of active Internet users visited Coupons/Rewards sites such as Groupon, Coupons.com and Living Social from home and work computers during September 2011.  Compared to the same month last year, visits to these sites were up in each country except the U.K., and in seven of the ten countries, daily deal site Groupon was the most-visited site in the category.

In the U.S., NM Incite, a Nielsen/McKinsey Company, found that nearly 60 percent of social media users visit social networks to receive coupons or promotions, with 23 percent saying they do this on a weekly basis.  When comparing visitors to Social Networks and Blogs and those who visit sites that offer coupons and rewards, there is strong overlap between the two categories.  During September 2011, 43 percent of visitors to Social Networks and Blogs also visited a Coupons/Rewards site.  Additionally, 44 percent of Facebook’s audience and nearly two-thirds (63%) of Twitter’s audience visited these sites.  In fact, after email and search, Facebook was a key source of traffic to Groupon and Living Social during September – meaning Groupon’s and Living Social’s visitors came directly from Facebook – further demonstrating that social networking plays a key role in driving consumers to seek out discounts and special offers.

As the holiday shopping season approaches and with the economy still weighing on consumers’ minds, brands and advertisers should consider leveraging social media to offer consumers incentives.  Nielsen research indicates people will go for it – U.S. adults online who follow a brand or celebrity on social networking sites are 52 percent more likely than the average adult online to download an online coupon and nine percent more likely to shop online.

*Nielsen has meter-measured Internet data in 10 major markets: Australia, Brazil, France, Germany, Italy, Japan, Spain, Switzerland, U.K. and U.S.

When considering new and flexible retail formats for grocery shopping, specific preferences emerge when it comes to particular online delivery options, according to Nielsen’s 2011 Global Online Survey of more than 25,000 Internet respondents across 51 countries. While more than half (52%) of global online consumers say they are likely to place a grocery order online if it is delivered to their homes, less than one-third feel the same if they are required to pick up the online order curbside (27%) or via a drive-thru window (30%). Interestingly, more consumers—just over one-third (36%)—say they are willing to pick up an online order inside the store.

The online shopping/home delivery option is most embraced by consumers in Asia Pacific, where more than three-quarters (77%) say they are likely to take advantage of this option, which contrasts sharply with one-fifth of North Americans (20%) and one-third (35%) of Europeans. “The main resistance in developed countries in Europe and North America is primarily due to the high volume of grocery stores that are available,” said Jean-Jacques Vandenheede, Director Retailer Industry Insights, Nielsen. “In Asia Pacific, fewer physical stores and a very digital consumer base equal a fertile distribution channel for online.”  About half of respondents in Middle East/Africa (48%) and Latin America (51%) indicated they are likely to shop for groceries online for home delivery.

Using hand-held scanners to record purchases while shopping to avoid waiting on checkout lines was welcomed by half of global online consumers. While interest is again highest among Asia Pacific consumers (60% interested and only 14% unlikely to try it), in each region, more consumers indicated they are likely to try it than not.

For more detail and regional insights, download: Shopping & Saving Strategies Around the World.

Reported use of coupons is greatest in North America (65%) and Asia Pacific (55%). The United States (66%), China (67%) and Hong Kong (65%) are the three leading markets for reported coupon use as a way to save money.

“About 80 percent of U.S. households use manufacturer coupons across all retail outlets, which is up slightly from 2009 to 2010,” said Todd Hale, SVP Consumer & Shopper Insights, Nielsen. “But coupon usage is concentrated—70 percent of 2010 manufacturer coupon purchases came from just 13 percent of coupon-using households. These coupon enthusiasts are big spenders across the total store and are young, more affluent and have large households.”

“In China, 35 percent of hypermarket sales in key cities are sold on promotion—a stable contribution over the past two years,” said Peter Gale, Managing Director Retail Sales, Nielsen Asia Pacific and Greater China. “In most Asian countries, simple price cut promotions are the main promotional vehicle supported by direct mail leaflets and newspaper advertising.”

While 38 percent of European consumers indicate using coupons to save, there is wide variation within the continent. While at least half of consumers reported coupon use in several western and southern European countries, such as Belgium and Portugal (63%), Greece (55%), France (53%), and Spain (50%), in other markets, particularly in northern and Eastern Europe, coupon use is much less prevalent. “Belgians are the record holders in terms of coupon redemption, but in countries like Germany or the Netherlands, their usage is very marginal,” said Jean-Jacques Vandenheede, Director, Retail Industry Insights, Nielsen Europe. “Many retailers in Europe are rather reluctant towards that practice.”

In Latin America and in Middle East/Africa, reported coupon use is much less common as a saving strategy. Only 25 percent of consumers in Latin America and 18 percent of respondents from Middle Eastern/African markets report using coupons. “In the Middle East, price cuts is the most popular promotional vehicle used by retailers along with volume discounts,” said Bassel Adel, Director Retail Services, Nielsen Middle East, North Africa, Pakistan. “However, consumers are gaining a greater awareness of leaflets, which are driving store visits and prompting retailers to actively advertise promotions in newspapers.”

For more detail and regional insights, download: Shopping & Saving Strategies Around the World.

The study shows that while factors relating to value and price are important drivers of where to shop and what to buy, retailers and manufacturers who offer good values—whether through sales and promotions or via larger-sized economy packaging—stand to gain the most from consumers who continue efforts to stretch their money in a tough economy.

The preference for value over lowest prices in retailer choice was found to be true in Asia Pacific, Europe, Latin America, and North America, while slightly more Middle East/Africa respondents preferred lowest overall prices (59%) to good values (54%). Other attributes rated as “highly influential” by more than half of global online consumers were convenient location, great sales/promotions, well-stocked shelves and high-quality fresh produce.

Bigger is Better & Quality is Key
Commodity and raw material costs continue to rise, squeezing profit opportunities for producers and brands. For CPG manufacturers and retailers seeking direction on consumer demand, the study found a clear preference for strategies that increase value—even in the form of more expensive overall package prices.

When given the choice of either purchasing large value packs at a lower price per serving or smaller pack sizes at a lower cost, global online consumers voted 2:1 for the former. Thirty-six percent of global online respondents indicated they would prefer manufacturers to offer larger economy size packages, with lower prices per usage/serving. Half as many respondents (18%) said they would prefer new, smaller-sized packages at lower prices, and only about one-in-ten (12%) would prefer modestly downsized packages at the existing price level.

Roughly one-third of consumers in every region say they would prefer the larger, economy-sized packages, but the sentiment is most pronounced in North America, where 39 percent of consumers indicated a preference for value packs, 20 percent for smaller packages at lower prices, and 11 percent for modestly downsized packages at current prices. “However, in tough economic times and with wide fluctuations in commodity pricing, downsizing has been a successful strategy taken by manufacturers and retailers,” said Todd Hale, SVP Consumer & Shopper Insights, Nielsen. “To remain profitable, retailers and manufacturers have a few choices: raise prices to cover input increases, modify ingredients to make products cost less to produce or downsize.”

Consumers around the world make it clear that quality is not to be compromised. Producing slightly lower quality products, but keeping prices the same is the least favored option among consumers in all regions. Raising prices is also a strategy that consumers do not embrace.

For more detail and regional insights, download: Shopping & Saving Strategies Around the World.

Nielsen’s Todd Hale, SVP Consumer & Shopper Insights, shared new research at the U.S. Consumer 360 Conference about the benefits of both print versus digital circulars and outlined the steps required to optimize both.

Shoppers prefer paper, but digital has strong conversion rates

Sixty percent of shoppers from a recent Nielsen survey say they look at printed paper material either mailed to the home or in newspapers at least once per week. The only electronic tactic that matches printed paper’s weekly reach is email. But while far fewer people are looking at sales and product information from digital methods like social media sites, store sites using a tablet PC or from smart or mobile phones, the weekly usage conversion rates are strong.

And demand goes up for high tech information sources when shoppers are asked what they want for the future. While nearly 90 percent of consumers still want print, more than 70 percent want email and traditional websites and about one-third are interested in social and smartphone applications. These numbers are even higher among younger generations of shoppers who say they still want paper, but they are more accepting of all information sources.

The research showed that while printed material gets shoppers in the store, digital tactics reinforce and reward loyal shoppers. Printed campaigns help shoppers find deals about their favorite products and locate widespread sales and high-tech touch points such as tablets, social sites and in-store kiosks are used to more so for research purposes.

Today, printed circular response promotion lifts are less effective than five years ago, delivering about a 20 percent return on investment in 2010, compared to a 28 percent boost in 2005. An improved mixture of items with an overall higher lift profile and/or timing improvements can counterbalance smaller average lifts. Don’t underestimate the impact your competitive advantages/disadvantages have.

A Move to Improve Online Offerings

For many brick and mortar retailers, figuring out how to effectively draw people to online offerings and then determining what contribution online efforts are having to offline sales is a challenge. In fact, few of these retailers get more than 20 percent of store shoppers to visit their site, despite the fact that the majority of shoppers spend 25+ hours per week online.

In study after study, Nielsen finds that the online circular is the most widely used part of a grocery/drug retailer’s web site, but the lift gained is a bit less than the lift seen for the site overall. The research also shows that:

• Online display ads drive offline sales
• ROI is generally higher than traditional media
• Every online campaign does not work
• Success is driven by new shoppers, not greater spending among existing shoppers
• The best responding offline segments are not always the most responsive to online ads

The Secrets to Success

Put a process in place for both print and media campaigns that tracks ongoing optimization. For print, start by defining who won the week – know what you did and what your competitor did in terms of attributes page-by-page. A department-by-department win/loss scorecard that includes display compliance should be deployed to get below the surface of the ad.

For digital, an understanding of past shopping behavior makes a big difference in the ROI of online campaigns on driving offline sales. Customer-based reach tactics can also be effective, but often requires a level of analysis beyond what is known about existing brick and mortar segments. Creative messaging with price and promotion on specific items is particularly effective.

While print will remain a strong part of the circular mix for five to 10 years out, it needs to be a leaner and more precise vehicle. Digital is necessary to bring about the type of consumer relevancy that future shoppers will expect. It will evolve along with development on the web and in social media and will be driven to a large degree by younger and more diverse population segments.

Pretty deep. According to Nielsen, three-quarters of U.S. households believe store brands are a good alternative to name brands and nearly two-thirds of households say that store brand quality is just as good as name brands. In a recent Progressive Grocer Store Brands article, the depth of store brand buying reveals just how much consumer’s behaviors and attitudes have aligned.

With nearly 70% of store brand dollar sales coming from consumers who are “variety-seekers,” retailers can encourage deeper levels of store-brand buying by:

• Rewarding key consumers with continuity-based promotions.
• Implementing repeat stimuli efforts
• Targeting specific shoppers through direct mail efforts

For more details and tactical examples, continue reading at Progressive Grocer Store Brands.

“Although gas prices are not as high as they were in mid-2008, they have been edging up for some time and continue to impact how consumers shop and buy,” said Todd Hale, senior vice president, Consumer & Shopper Insights, The Nielsen Company. “Consumers continue to employ money-saving strategies, such as using coupons and gas purchase incentives, as means to deal with gas costs given overall economic concerns.”

Key findings of the survey show that the economy still has consumers looking for cost savings across the board, even as they revert to some pre-recession spending habits.

• 63 percent of consumers said they continue to combat high gas prices by combining errands/trips, 39 percent said they’re doing more at home and 29 percent noted reducing spending to a small degree — moderating from levels seen at the peak of the recession.
• Eating out less (46 percent) and coupon use (38 percent) ranked high as money-saving strategies due to gas costs, elevated from pre-recession times.
• Supercenters are losing some appeal for consumers seeking gas savings; only 26 percent of households say they shop more at supercenters to save on gas compared to 28 percent a year ago.
• Sixteen percent of households say that gas prices have no impact on their driving or spending; double the response in June 2008.
• Some consumers buy gas at locations because of incentives tied to their spending at stores where they shop, such as grocery (24 percent); convenience stores/gas (19 percent); warehouse/club (14 percent) and mass merchandisers (7 percent).

“Consumer packaged goods (CPG) retailers continue to demonstrate good marketing and merchandising tactics by linking in-store spending to gas savings at their pumping sites or with participating petroleum companies,” said Hale. “Some programs have been extended to reward shoppers with gas discounts and in-store savings based on gas spending. Other programs include participation from manufacturer brands. While gas prices are a bargain compared to mid-2008, filling up a 15 gallon tank represents a significant cash outlay and an opportunity for CPG retailers and manufacturers alike to offer saving solutions.”

Results are based on Nielsen online survey responses from nearly 52,000 U.S. households, geographically and demographically representative of the total U.S. population. The survey was conducted in June and July 2010 when regular gas prices averaged between $2.70 and $2.75 per gallon.

Todd Hale, Senior Vice President, Consumer & Shopper Insights

In 2007 and for much of 2008, rising gasoline and commodity prices led to a wave of price increases in the consumer-packed goods industry. For some categories, it was not uncommon to have two to three price increases as ingredient, packaging, energy and transportation prices jumped sharply. During that time, many retailers—particularly those selling food and beverages—experienced a lift in sales and profits. As recessionary pressures intensified at the end of 2008, gasoline and commodity prices started to drop and many retailers began passing on the savings to their shoppers and cutting prices broadly to be more competitive with value retailers.

Lower prices on groceries, gas and other household items have offered some degree of relief to stretched American consumers. With uncertainty about the economy persisting, shoppers continue to watch their money and seek out value. But to retailers, lower prices present challenges: how to grow market share without taking a hit on the bottom line; and, after being very vocal about the savings they are providing their shoppers, how do retailers elevate prices without disenfranchising shoppers?

Nielsen’s recent review of retail prices found that over the 4-week period ending June 12, 2010, prices were off or flat versus year ago providing exceptional value to consumers, but weakening trends for retailers. Unit prices have been dropping sharply since March 2009, and the number of items on promotion—in the form of feature ads or displays—has gone up. When one store slashes prices to gain competitive advantage, others follow suit. Meanwhile, brands have resorted to more promotions to stimulate sales and stem the growth of private labels.

Unfortunately for retailers, these price cuts and heightened promotions have not achieved the desired effects as both dollar and unit sales are off in each of the last three (four-week) periods. But the big unanswered question is: would the situation be worse without these value efforts?

Which Departments Are Faring the Best?
For consumers, the good news is that prices across all departments are better now than what was experienced for much of 2008 and into early 2009. Some departments showed price increases in recent quarters, such as dairy, fresh meat and fresh produce, but prices are still very attractive for consumers seeking savings. Within dairy and fresh produce, it is interesting to note that increased prices are yielding stronger retail sales trends.

The deli department has held up quite well, while alcoholic beverages is the shining star of departments, posting sales increases in both dollar and unit terms.

The departments with the most negative sales trends were fresh meat, non-food, and general merchandise, with dollar and unit losses the greatest among the non-food and general merchandise departments. Dry grocery department sales trends were similar to the total store trend. The frozen department was on a stronger sales trend, but unit and dollar sales have fallen in recent periods.

In a further sign that price cuts were not having a positive impact, only one of the top 16 categories with the largest price cuts actually saw dollar sales rise. So drastic price cuts don’t appear to provide incentives to alter the frequency of consumption!

Unemployment Continues to Stall Recovery
Perhaps the biggest factor preventing retailers and CPG companies from raising prices is the state of the U.S. economy. While the Great Recession may be officially over, the recovery has really only started in earnest—and in unique ways, namely, without the growth of jobs. After four straight months of job creation, the momentum was stopped dead with a surprise June announcement that the economy had once again shed jobs—this time 125,000. The unemployment rate dropped to 9.5%, but including people who are not working full-time but would like to be, that number goes up to 16.5%. Moreover, almost half (46%) of unemployed individuals have been without a job for more than 27 weeks. And, unemployment is particularly high among ethnic, younger, less educated and male populations.

These statistics are obviously sobering, and they limit the ability of CPG manufacturers and retailers to raise prices without losing customers to value brands and channels.

What’s the Answer?
As prices have fallen, so have same-store sales trends for retailers, particularly those focused on grocery. Retail price wars are having a negative impact.

So how do retailers get through this period? In the short-term, look for opportunities to raise prices on selected items when justified; merchandise assortment that you have a competitive advantage; look for opportunities to up sell shoppers to build baskets; offer your biggest spenders the special kind of attention they deserve.

Until consumers feel more confident about the state of the economy, their personal finances and job prospects, they are going to seek bargains and keep their spending in check. While there have been some signs of optimism, it seems as if something arises that cancels out any progress made. One thing is for certain, however: until there’s a period of consistently positive economic news in the U.S., consumers will be skittish, and retailers and CPG manufacturers need to be prepared to continue weathering the storm and finding innovative ways to grow share without sacrificing dollars.

With all eyes on the economic recession in the U.S., it’s easy to underestimate the major trends currently reshaping the consumer packaged goods (CPG) industry. According to The Nielsen Company’s Retail 2015 Forecast, the pace of change is only accelerating as technology, marketing trends and retail formats converge to redefine how CPG retailers and manufacturers interact with consumers.

Big Winners
By 2015, we predict mass supercenters and e-commerce to be the big winners by dollar share gains, growing by a combined five share points between 2009 and 2015. Warehouse club, dollar store and pet store share will also grow share positions. Nielsen forecasts that supermarkets will continue to lose share, but at a declining rate. While both high-end and low-end niche grocers will grow share, overall share positions will remain fairly low given lower per-store sales compared to larger formats. Other key CPG channels, including drug stores, mass merchandisers and convenience stores, will grow dollar sales but will suffer share losses.

Nielsen expects to see further CPG retail consolidation as retailers look for scale and opportunities to expand their footprint into existing and new areas. Retail consolidation will be most active within the supermarket and convenience channels in the race for scale. Today’s big players will only grow bigger. Industry change will grow faster and more intense in the next five years, requiring advanced, future-focused change management skills among CPG professionals.

Out with the Paper Shopping List, in with the Smartphone
One of the biggest CPG shifts by 2015 is already underway: the use of smartphones to engage consumers and help them make better shopping choices. According to Nielsen, smartphone penetration stands at 23% of all mobile subscribers and is expected to overtake feature phones in the U.S. by the end of 2011. Nielsen predicts that by 2015, smart phones will be the primary enabler of consumer shopping engagements and new technology innovations will generate additional opportunities for retailers and manufacturers.

Coming to a Smartphone Near You: a Personalized Shopping Experience
Driving the rapid adoption of smartphones is the seemingly endless variety of apps, which take full advantage of the smart phone’s geographic location and interactive capabilities. Retailers are already using smartphones as a replacement for frequent shopper cards, sending store coupons and deals directly to a shopper’s phone. Nielsen expects CPG companies to further leverage the smartphone’s location tracking abilities to target communications and promotions to shoppers both in and out of stores, and up sell consumers on other items based on prior purchases. In addition, consumers will have the ability to locate the best available price for a given item, access real-time product reviews and promotions and manage everything from household budgets and pantry inventory to tax preparation and filing.

Prepare for the Future
Consumer packaged goods retailers and manufacturers should focus on the following initiatives now to position their businesses for future success:

• Develop or buy online/digital/social marketing expertise. If you don’t have this expertise today, get it.
• Plan for diminishing returns from traditional media. Newspaper feature ads and free standing insert (paper-based) coupons dominate today, but for how long?
• Nurture retailer/supplier relationships. Have contingency plans dealing with consolidation impact.
• Get more flexible with format planning. Consumers today are flexible and completely mobile, which means we need to get more flexible about how and where we sell our products. Study emerging economies to understand flexible markets. Think about future format planning for your next one to three generations of formats.
• Demand forecasting by category and consumer segment. Understand how changes in demand at the category and consumer level will provide risks or opportunities
• Expand via regional or global opportunities. With slowing domestic population growth impacting sales growth, seek opportunities outside traditional geographies to reach more households.
• Make future management a company strength. Given the pace of change that we will experience over the next five years, future management needs to be a core competency or the chances of your stores or brands being a part of the future will be in serious jeopardy.
• Understand the new faces of opportunity. With an increasingly aging and ethnic population, you can’t afford to ignore generational and multi-cultural consumers. It is critical for marketers to adapt in order to gain the attention and brand/shopper loyalty of diverse generations and multi-cultural families of the future.

Gone are the days when online marketing was led solely by the dotcoms of the world. Today, many CPG companies have embraced online and social marketing and are pushing the envelope further each day. In the midst of considerable consolidation and change, the future will be owned by those companies that harness technology to the make the consumer shopping experience easy, efficient and fun.

SUMMARY: Once on their way to extinction, coupons made a strong resurgence in 2009. While they offer consumers a chance to stretch their dollars further, they also offer real growth opportunities for retailers and manufacturers—if they know exactly who to target and how to leverage established and emerging coupon delivery vehicles.

Back to the Future
People of a certain age may nostalgically recall the sight of mom flipping through the Sunday newspaper to clip coupons from the numerous inserts stuffed in the paper. She may have even had a little envelope or “coupon caddy” organized by product category. This kind of memory tends to be among those of us who are baby boomers or Gen Xers—a quaint recollection from the previous century. Indeed, coupon redemption hit a peak in 1999: 4.6 billion, as reported by Inmar.

Since then, it’s been downhill for the humble coupon. During the three-year period ending 2008, annual manufacturer coupon redemptions leveled off at just 2.6 billion per year.

The “Great Recession” of 2009 changed all of that and marked a sort of renaissance for the coupon. Inmar reports that coupon redemptions grew by 27% as Americans searched for ways to cut household costs and get more for their money. NCH Marketing Services claimed 2009 coupon redemption levels “achieved the second highest year-over-year growth ever recorded.”

Paperless Progress
While newspaper inserts are still the primary method of coupon distribution (89%) and redemption (53%), Internet redemption growth has skyrocketed, rising 263% in 2009.

And while clipping continues to be a primary means of distribution, manufacturers and retailers launched new ways to get coupons into consumers’ hands such as printable coupons on the Internet, in-store kiosks and discounts linked to frequent shopper cards via smartphones and computers, negating the need for a paper coupon at all. In short, it is easier than ever to distribute and use coupons, and this convenience is also a key driver of redemption growth.

Inmar reports that the majority of coupons were redeemed at conventional grocery stores (65%), but all classes of trade—dollar stores, mass merchandisers, convenience stores, military commissaries and drug stores—posted double-digit redemption growth:

Redemption growth outside of traditional food channels is a reflection of a coupon movement that started with food, but quickly turned to non-food in the second half of 2009. Non-food coupon redemption growth escalated from a rate of 9% in the first quarter to 46% in second quarter and continued growing throughout the year—rising 45% in third quarter and 37% in fourth quarter. A total of 1.2 billion non-food coupons were redeemed in 2009, representing one-third all coupons.

80/20 Rule in Play
While the recession drove heavier coupon usage across low to heavy coupon users from 2008 into 2009, all but the heaviest coupon user group experienced negative total unit growth (with and without a coupon). All told, 83% of units purchased with manufacturer coupons in 2009 were done so by just 22% of households. Coupon enthusiasts—the heaviest users—accounted for 65% of manufacturer coupon unit purchases and 18% of all unit purchases in 2009. They drove a disproportionate amount of sales and sales growth—shopping more frequently, making 1.7 more trips than non-users and buying more (a rate 1.8 times greater annually). While some might think that “crazed coupon clippers” are only interested in a good deal, these findings suggests real benefits to manufacturers and retailers deploying coupons in their marketing mix.

More Money = More Coupons
With the value offered by coupons, one might think that the lowest income households would be among the heaviest users. In fact, more affluent households dominate coupon usage: 38% of “super heavy” users and 41% of “enthusiasts” come from households with incomes greater than $70,000. Households with income of $100,000 and up were the primary drivers of coupon growth in 2009. The enthusiast category also attracts a disporportionate number of households with incomes between $50,000 and $69,900.

Trends relating to newspaper readership provide some explanation for this imbalance.  According to Scarborough Research, better educated and higher income households buy and read the newspaper more than others and newspapers remain a key vehicle for delivering coupons. Additionally, promotions are generally targeted in areas with more affluent consumers. In essence, the better educated and more affluent consumers are much better at looking for deals as they recognize the value of money.

Beyond income levels, more than half (51%) of larger households (3+ members) are “enthusiasts”, while roughly one-third of non- and lighter coupon users are single person households. Younger female households use coupons more, while male-only households use them less. Older users (65+) are also important “heavier” and “super” coupon users.

All ethnic groups use coupons, but three-fourths of the average coupon “clipper” is white. Households residing in comfortable country and affluent suburban spreads are more likely to be heavier coupon users, while non-users are more apt to be those households living in rural areas and struggling urban core areas.

Manufacturers and retailers have real opportunities to reach different groups with coupons and promotions, particularly African-American and Hispanic households. While this may require adjustments to existing tactics, the potential pay-off—in terms of volume growth and winning new customer loyalty—can be significant.

Future Look
As the economy improves, will consumers continue to use coupons? With the economic recovery taking hold slowly and without significant employment growth, expect coupon use to continue. As long as Americans feel unsure about their personal finances or confident about their jobs, they are going to continue to look at ways to save and get the most for their money. In addition to expanding the appeal of coupons in general, manufacturers and retailers would do well to target enthusiasts: their shopping behaviors and demographics make them extremely appealing.  With advancements in coupon delivery vehicles that enable both better targeted coupon distribution and redemption, manufacturers and retailers will continue to have real opportunities to use coupons to drive sales for the next few years and beyond.