Inmar MidYearTrends 073113

#coupontrends

2013 COUPON TRENDSMID-YEAR REPORT

Andrew Coleman & Devora Rogers | July 31, 2013

® © 2013 Inmar, Inc. All Rights Reserved. #coupontrends

About Inmar

2

• Privately held company with Headquarters in Winston‐Salem, NC• 4,200 employees• 30 facilities across USA and Mexico• Serving retailers in 11 countries• 32 years of experience serving retailers and manufacturers

• 25 clients in Fortune 100• Invested more than $100 million in Information Technology over the last four years

Over $35 billion a year in asset redemptions & payments

® © 2013 Inmar, Inc. All Rights Reserved. #coupontrends 3

Devora Rogers

• SR Dir., Retail Marketing Insights• Behavioral and Loyalty Analytics• Born in Digital, raised in Shopper

• [email protected]• 336.770.3495• Twitter: @devoraerogers


Andrew Coleman

• Promotion Consulting & Analytics• Digital Brand Management• Agency and Client‐side perspective

• [email protected]• 336.631.2973• Twitter: @andrew_coleman


Agenda

• Welcome• Methodology & Definitions• Topline Trends• Method Trends• Digital Trends• Next Steps / Client Resources• Questions

5


Methodology

6

• Percent change compares first six months of 2013 (Jan – Jun, “1H”) with first six months of 2012.• Distribution and redemption data consolidated from the Inmar coupon database.• Extrapolated industry distribution and redemption statistics using Inmar and Kantar Media data.• Cross‐check data with major coupon distributors and third‐party vendors.• Conduct analysis to develop key insights.


Manufacturer Funded Offers

Digital Offers

Definitions (just to clarify…)

7



14%Rarely

26%About Half the Time

33%Usually

27%All the Time

In the last three months, how often have you used coupons when shopping in‐store for: • groceries• household supplies• health care items• personal care products

Inmar 2013 Shopper Study


166.9 170.4

H1 2012 H1 2013

Key Takeaways: Distribution (in billions)Key Takeaways: Distribution (in billions)

10

UP 2.1%


2013 Distribution

11

Free‐standing Insert89.8%

In‐Ad2.0%

Electronic Checkout1.2%

Magazine On‐page1.0%

Magazine Pop Up0.9%

IRC Group0.9%

Direct Mail0.7%Sunday

Supplement0.6%

Others2.9%

Handout0.6%


Key Takeaways: RedemptionKey Takeaways: Redemption

12

1.49 1.39

H1 2012 H1 2013

DOWN 6.6%


2013 Redemption

13


Distributed: $1.57/coupon (‐0.6%)

Distributed: 1.46 units/coupon(‐5.2%)

Distributed: 2.2 months (‐4.3%)

Marketing tactics impacting redemption

14

Average Face Value Distributed

Average Purchase Requirements

Distributed

Average Redemption Periods Distributed


Food / Non‐Food Interlude

Distribution Redemption

58.7% 41.3%Non‐Food

Food

67.6%

32.4%Food

Non‐Food



Distribution Redemption

100b 70.4b

Non‐Food

Food

939.6m

450.4mFood

Non‐Food


Distributed: $1.02/coupon (‐5.6%)


Distributed: 2.4 months (NC)


17

Average Face Value Distributed

Average Purchase Requirements

Distributed

Average Redemption Periods Distributed

Distributed: $1.96/coupon (1.6%)


Distributed: 2.0 months (‐13.0%)

Non‐Food Non‐Food Non‐Food

Food Food Food


METHOD TRENDS

GROWTH IN A STORM18


FSI moves the needle…

19

Fast FactsRedemption Volume:~615 million

Redemption Change:~‐79 million (‐11.4%)

Overall Share of Redemption: 44.2%

Avg. Redemption Rate:0.49%

Distribution Volume:~153 billion

Distribution Growth:~5 billion (+3.4%)

…in both directions


Notable Methods Showing Redemption Growth

20

IRC Group

+7.32%Internet

+12.1%Electronic Shelf

+19.1%


Instant Redeemable + IR Cross Ruff

21

IRC Group

+7.36%

Fast FactsRedemption Volume:

~250 million

Redemption Change:~17 million (+7.36%)

Overall Share of Redemption: 18%

Fast FactsAvg. Redemption Rate:

24.86% (IR)10.77% (IRC)

Distribution Volume:~1.5 billion

Distribution Change:~‐76 million (‐4.6%)


Internet “Print At Home” Coupons

22

Print At Home (PAH)

+12.1%Also Known As:

“Internet Printable”Alinea Method Code:

“NET”


~71 million




8.01%

Distribution Volume:~600 million

Distribution Change:~‐178 million (‐22.9%)


Electronic Shelf: In‐Aisle Discovery

23

+19.1%


~28 million




11.47%

Distribution Volume:~327 million

Distribution Change:~101 million (+44.5%)


Paperless

24


Digital coupons redeemed in 1H 2013: 28.5 million

25


Average face value:$1.42

Average Purchase Requirement:1.46

Average Redemption Period: 55 days

26


78% 65%

65% 63%

“I want…”

27

“coupons to be automatically applied to my purchase.”

“coupons loaded to my store loyalty card for products that I normally buy.”

“…stores to email me with coupons for products that I normally buy.”

“…available store coupons to be added to my store loyalty card.”


Frozen Category: Digital Driving Engagement, Purchase

28

Average Influence

High Influence/High UsageHigh Influence/High UsageHigh Influence/Low UsageHigh Influence/Low Usage

Low Influence/High UsageLow Influence/High UsageLow Influence/Low UsageLow Influence/Low Usage

Ave

rage

Usa

ge

Promotion

1 Noticed colored labels / tags for sales

2 Clipped coupons from a newspaper or magazine insert

3 Read / cut coupons from a flyer at the store

4 Visited a store's website to download/print coupons

5 Used a coupon received at the register on my receipt

6 Used coupons from store printed with receipt

7 Used instant coupons from product package

8 Received mail / coupons at home from a store / retailer

9 Visited a brand website to download/print coupons

10 Download coupons from the retailer's app to my loyalty card

11 Visited a blog/forum about using coupons

12 Download coupons to my Smartphone

5

6

7

8

910

11

1

2

3

412

Promotion Only Quadrant

Store website coupon download

Newspaper coupon clipping

Blog about coupons

Download coupon to smart phone

® © 2013 Inmar, Inc. All Rights Reserved. #coupontrends29

Evolving digital marketplace – grocery CPG

Copy paper /

paste into digital

Digital 1.0

Shift from pull to push

Digital 2.0

Omni channel / integrated

into shopping

Digital 3.0

Inmar data reveals evolving shopper behavior as shoppers begin to integrate digital into their core shopping process

® © 2013 Inmar, Inc. All Rights Reserved. #coupontrends30

What’s Next for Digital?Coming to the End of the Beginning

Stage 1.0

• Translate paper to digital distribution; get digital at retailer.com, brand.com and few third‐party sites

• Fragmented consumer experience—post the coupons, consumers search and find; if willing to hunt, you can get

• Fragmented IT platforms for delivering digital

• Click rates charged by media companies—no big benefit to retailers

Result:• Retailers skeptical if paperless worth it• Digital and PAH small as % of total


What’s Next for Digital?Shopper driven marketing

Stage 2.0• Retailers use shopper purchase history and

online data—not demographics only—to connect meaningful offers to shoppers

• Offers automatically load to unique identifier for improved consumer experience

• IT platforms are more robust and established

Result:• Aligned promotions, media targeting plans• Digital redemption grows exponentially


What’s next?Intuitive and connected marketing

Stage 3.0• Analytics engines anticipate future

purchase, rather than reward past behavior• Retailers and brand collaborate on shopper

optimization rather than compete• All programs integrate with mobile

shopping

Result:• Brands have more visibility into how

national spending can drive sales with specific retailers

• Shoppers feel smarter, are able to make better decisions

• Deal hunting becomes fast, easy, simple

Connecting manufacturer CRM data to retailer loyalty data


What is Omni Channel Retailing?

• Seamless shopper experience across multiple retail channels

• Consumer driven, Retailer and brand enabled

• Real‐time data is synchronous across all touch points

• Merchandise and promotions are NOT channel specific


Omni Channel: Shopper Perspective

Shoppers expect to see the same Deals, Data and Inventory across all channels, seamlessly, when they want.


Is there “Omni‐loyalty?”

35


How you can

36


Inmar’s Digital Offer Portal

• One View to Your Promotions– Set up and analyze paperless and print‐

at‐home coupon programs• Reporting Dashboard

– Manage budget allocations, review offers and see results on demand

• In‐Flight Monitoring– See where offers are redeeming and

tweak programs instantly• Audits and Controls

– See all activities and turn them off activities or reallocate as required

37


Making Omni‐Channel a Reality…Now

• Consider a brand email program that links to local retailers

• Take part in our publisher media trial to enable display ads to become smarter and actionable

• In‐store activation tied to online promotions



Summary

• Shopper interest in coupons remains quite high, despite a shift in user sentiment (“from effort to entitlement”)

• Distribution continues to grow, powered primarily by FSI

• Redemption continues its modest decline, also primarily due to FSI performance

• Certain methods are showing strong redemption growth –primarily in‐store methods, and particularly digital.

40

For more information:

41

[email protected]@andrew_coleman

Andrew [email protected]@devoraerogers

Devora Rogers

Documents

Inmar MidYearTrends 073113