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Economic shock gives rise to coupon cutting

  • Story Highlights
  • Shoppers are turning to coupons for deals on luxuries and necessities
  • Entertainment.com users print 198 percent more coupons for casual dining in 2008
  • Use of coupons for services such as oil changes, dry-cleaning up 153 percent
  • "Couponing" at big box retailers up 14 percent, even as restrictions increase
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By Emanuella Grinberg
CNN
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(CNN) -- The rising price of consumer goods is driving shoppers from all walks of life to use coupons for food, beauty aids and pharmacy products at an increasing rate, according to some of the country's largest purveyors of manufacturers' coupons.

Consumers from several economic backgrounds are clipping coupons.

Consumers from several economic backgrounds are clipping coupons.

The once-popular act of coupon cutting -- introduced by the inventor of Coca-Cola syrup more than 100 years ago -- is again becoming a household chore.

While people may be looking to spend less, they aren't necessarily cutting back on necessities or luxuries. Instead, consumers are hunting for deals on where to dry-clean their clothes, get their oil changed or take the family out to dinner, said MaryAnn Rivers, CEO of Entertainment Publications, which publishes community-based coupon books and Web sites.

Rivers said the company's site has seen a 153 percent increase in the use of coupons for day-to-day necessities and a 198 percent increase in the use of coupons for casual or "quick-serve" meals since last year.

"It doesn't appear activity has slowed down, they're just looking to save more often," said Rivers, whose publication is often sold in schools and community organizations as a fundraising tool. "We're getting back to basics with people. They are trading down from activities and moving into more affordable opportunities."

Other companies are also seeing gains. Florida-based Valpak, whose signature blue envelopes land in about 45 million homes each year, has seen use of its coupons increase 8 percent since last year for products such as groceries, take-out food, home improvement products and specialty retail.

"Coupons motivate customers when they're looking at different stores that offer the same goods. They're more likely to go with a store that offers coupons," Valpak spokeswoman Marsha Strickhouser said.

Strickhouser said specific figures related to usage is proprietary information and unavailable for release, but said the number represents a significant surge in consumer response in the company's 40-year history.

"People might say coupons are just for tightwads, but people from all kinds of economic backgrounds are more likely to use them," Strickhouser said. "It's good sense to use them."

In mid-2006, consumers bucked a 15-year period of decline by redeeming 2.6 billion manufacturers' coupons.

Since then, the numbers have remained consistent, with redemption at mass merchandising stores such as Wal-Mart and Target up 11 percent since 2007, according to Charles Brown, co-chair of the Promotion Marketing Association's Coupon Council.

"Couponing," as Brown calls it, also has risen in dollar stores and convenience marts by 14 percent since last year, even as the use of coupons as a marketing tool has declined in the packaged goods arena.

"It's an individual company strategy. Some may be promoting discretionary items that might not be purchased if a consumer is economizing; others might be seeing natural sales generated as consumers economize more," Brown said.

As couponing has become more popular, Brown said manufacturers have become more restrictive with their offerings by imposing shorter duration periods and more purchase requirements to get the deal.

"If the consumer is being responsive and using more coupons, the marketer wants to keep that contained so it doesn't become too costly to them," Brown said.

Despite the restrictions, Brown said he anticipates continued growth in the use of coupons as people get comfortable with the idea of coupons, which languished in the realm of the frugal shopper.

"I think that what we're seeing is a behavioral change in the consumer that could have lasting effects. If you shift buying patterns and enjoy benefits of doing that, you will likely continue in that pattern," he said. "For the marketer, it's an opportunities to bring in more customers and get them to try new things."

All About National EconomyEntertainment Publications Inc.

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