Couponing craze continues at a slower clip
02/15/2013 12:00 AM
02/17/2013 12:23 PM
In the heart of the recession, we became a coupon-crazy country, clipping, printing and downloading billions of coupons a year.
That's still true, but the coupon industry is rapidly evolving, attracting younger users and more men, as well as zapping out more digital and mobile versions of the classic cents-off paper coupon.
Reflecting those trends, Sacramento recently landed among the country's Top 25 Most Frugal Cities, based on its digital coupon usage.
"Years ago, coupons were mostly for grocery items, like cereal. Now it's almost everything you're buying, from clothes to restaurants to drugstores," said Jeanette Pavini, household savings expert with Bay Area-based Coupons.com, which tallied the most-frugal-cities list.
She pinned Sacramento's first appearance on the list to several possible factors: California's relatively high unemployment rate, new openings of coupon-centric Walmart stores and younger couponers plucking their deals online or off their mobile phones.
Last year, the number of manufacturers' coupons issued – for everything from diapers to dog food – was a staggering 305 billion. That's a whole lotta coupons to be clipped, printed or downloaded.
Yet the number of coupons actually cashed in by U.S. consumers in 2012 slipped 17 percent compared with the previous year, according to NCH Marketing Services in Deerfield, Ill., which tracks annual coupon usage.
It's all part of subtle shifts in couponing, says Charlie Brown, NCH marketing vice president.
While paper coupons clipped out of the Sunday paper still dominate, digital coupons on websites, mobile phones and retailers' loyalty cards are attracting a younger – and increasingly male – audience. At the same time, manufacturers are offering more nonfood coupons, which may affect demand.
Despite the recent dip, coupon usage is still well above what it was before the recession, according to NCH data.
"There's a large segment of the population that's made it part of their shopping habit," said Brown. "Overall, the consumer has maintained a frugal mind-set that was established during the recent economic downturn."
That comes as no surprise to so-called "frugal bloggers" like Sacramentan Ashley Thompson, 29, who got hooked on couponing after college as a way to pinch pennies.
Thompson, who posts at NorCalCouponGal.blogspot. com, says couponing crosses all ages, incomes and genders. "It's not just a female-centered phenomenon anymore. More men are conscious about (spending) . It spans a whole spectrum, from minimum wage to those who make hundreds of thousands a year. Everybody can save money."
The couponing craze was fueled partly by TV shows like "Extreme Couponing" and savings-minded bloggers, websites and workshops.
As the recession eases off, consumer attitudes may be adjusting, says Darrel Ng, who's been blogging about local restaurant news and deals on his CowtownEats.com site.
"People have moved from finding the absolute cheapest deal to finding the most value," said Ng, noting the shift in his site's online traffic since 2009. Whereas two years ago a $2 beer might have been the most popular deal on CowtownEats, today it's higher-end offers like last month's Dine Downtown week in Sacramento, where folks tapped website coupons for $30 three-course dinners at some of the city's priciest restaurants.
Also factoring into the mix are so-called online "daily deal" sites, like Groupon, Living Social and dealsaver which have sprouted – and withered – at a fast pace. (Dealsaver is owned by the McClatchy Co., The Bee's parent.)
Last year, more than 140 new daily deal sites popped up; at the same time, another 560 globally shut down, according to Daily Deal Media, which tracks the industry.
Local blogger Ng feels they've "peaked and oversaturated" the market. "They aren't as good as when they first started. The quantity of deals is much bigger but it's questionable if you want them or not."
Boyan Josic, Daily Deal Media's founder and CEO, said the crowded daily-deal marketplace has contributed to a bit of "coupon fatigue," especially when companies that are bought, sold or merged sell their subscriber lists. Suddenly, a consumer who signed up for a local deal site is getting bombarded with unsolicited email offers from other companies.
Nevertheless, Josic and others say digital couponing, especially via smartphones and mobile devices, is making inroads.
Last year, about 90 percent of the 305 billion coupons issued were in print, either newspaper inserts or stand-alone mailers. While digital made up less than 1 percent of all those coupons, it accounted for more than 6 percent of the 2.9 billion that were cashed in, according to NCH Marketing.
Experts say we'll be seeing more of that, such as coupons loaded directly onto store loyalty cards, such as Raley's and Safeway. Other retailers are experimenting with coupon offers that pop up on smartphones as you pass by their door.
As for the 17 percent year-over-year dropoff in coupon use in 2012, NCH's Brown attributes it to a change in the type of coupons offered by manufacturers. Instead of issuing 75-cents-off coupons on pantry essentials like pasta or breakfast cereals, more companies last year were busily issuing nonfood coupons for health and personal care products, such as razors, deodorants and cold remedies.
Plus, coming out of the recession, there was pent-up eagerness among manufacturers to tout new products via coupons.
But consumers weren't buying. In NCH's annual survey, most of the 14.5 percent who reported using fewer coupons in 2012 said it was because they couldn't find coupons for the products they wanted or weren't tempted by unfamiliar new ones.
Nevertheless, bloggers like Ng and Thompson contend the save-a-dollar mind-set honed in the recession isn't going away.
"There's a new generation of people who have trained themselves to be more frugal," said Ng, who likened it to the lasting impact the 1930s Great Depression had on his grandparents' generation.
"There've been a lot of 20-somethings who had a hard time getting a job out of college or saw their parents losing a job," said Ng. "If history repeats itself, they'll better understand the value of a dollar and realize it's important to save."
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