Inmar Intelligence | December 19, 2011

Growth is good, if you're talking about your company's bottom line. But even then, steady and sustainable wins the race. The challenge is when growth is unpredictable and sporadic — the more so when that growth affects a cost to your business, like coupon redemption.

In recent years, the central coupon question on many promotions managers' minds has been, "How much of an increase in coupon redemption do I need to budget for this year?" With the industry, overall, seeing 5% more coupons redeemed in 2011 (January through September) than it saw in 2010, I'm confident quite a few of those managers got the answer wrong and had to start slashing late-year promotions because budgets were blown out early.

The consequence of this increased redemption has been a notable decline in the number of coupons distributed. Brands started 2011 cautiously, reducing available coupons by 7% in the first half. Then, as the consumer response continued to surge, brands pulled back further, resulting in a 13% decline in distribution in the third quarter.

The anticipated growth of redemption in the fourth quarter -- combined with the higher coupon response we've seen from shoppers so far -- is sure to prompt continued distribution restraint from brands the rest of this year and, likely, into early 2012.

Inmar Intelligence

Commerce Accelerated.™

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Holly Pavlika
SVP, Corporate Marketing
(336) 770-3596