How Coupons Are Slowing Transitioning To Digital Distribution

Posted on 2 October 2009 by Patrick FlanaganNo Comments

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A recent article in the Huffington Post (Sept 25, 2009) titled “Farewell to the Sunday Circular?” suggested that more an more Americans are choosing to go digital in regards to couponing.

From the Huffington Post article: “Now that our world has gone from print to digital and increasingly mobile, is the Sunday circular as relevant or as useful a tool as it was in the past? It is, but its margin is shrinking. A recent article in MediaPost reported on a Scarborough Research Report that Sunday newspapers still dominate, with 51% of households surveyed obtaining coupons there….”

So right off the bat, the article’s title is not really true at all.  The circular (e.g., Sunday Newspaper) is still the #1 source of couponing information as reported in the article, so for you circular fans out there the weekly ads are not dead! However I don’t really think that was the point.  Rather it was really about showing how digital coupons have a future and are growing.  Hold that thought however as lets first further explore the majority chunk of the coupon market which is still all about paper.

For a more detailed look at the sources of coupons, let’s look at a new study of coupon usage and the sources of coupons by Scarborough Research (August 2009) which found that while print coupons still dominate, virtual coupons in the form of text messages and emails (e.g., digital coupons) are making slow gains as more US users transition to the convenient digital delivery for coupons.

Circulars / FSIs are still the top source for coupons

However a somewhat less optimistic study of the sources of coupons done by Burst Media in March of 2009 stated the following:

“The Internet has seen significant growth as the primary source of coupons – increasing from a 3.8% reading in 2002 to 16.0% today. The Sunday newspaper is still the primary source of coupons for 29.2% of respondents – but that is down from a 35.3% reading in 2002. Other media cited as a respondents’ primary source of coupons include in-store circulars (14.9%), mail packs/direct mail (13.5%), weekday newspapers (8.3%), in-store dispensers (5.4%) and magazines (2.2%).”

So back to the core point of the Huffington Post story which was all about how digital coupons are the future.  A rebuttal point of view on how digital coupons are really not that important  can be found in a recent New York Times coupon article (September 2009) which referenced that less than 0.5% of redeemed coupons are digital, even now, and digital coupon redemption has increased only 25% year-over-year, in a year in which overall coupon usage increased 23%.  Currently average US household penetration of digital coupons is 8% which is nice, but the usage rate still is a bit low.

So a summary really is needed here.  With some many sources of stats, it does make one’s head spin. The skinny is:

• Coupons are showing growth for the first time in a few years
• Newspaper distributed coupons still rule
• Digital coupons are the future, but its still a ways off

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