Although predictions of an economic apocalypse may have reached a fever pitch in 2012, it did not ultimately prove to be a year of cataclysmic change for either consumers or civilization as a whole. Still, for promotions professionals and digital and retail marketers, there were several disruptive, significant events that measurably impacted the industry. Last year brought with it sporadic economic recovery, increased smartphone and tablet adoption and a continued consolidation across (and in some cases, contraction of) traditional media – all while shoppers grew more active in their pre-purchase decision-making behaviors. So, how, in the face of all this – along with the steady acceleration of ecommerce, shrinking marketing budgets and general business volatility – did coupons perform? In this webinar from Inmar Analytics, shopper engagement expert Devora Rogers will present statistics and trends in coupon distribution and redemption from 2012. She will also offer insights as to the causes, effects and future implications of last year’s coupon activity and what it means for brands, retailers and shoppers. Rogers, formerly Group Director for IPG’s Shopper Sciences, will share data from Inmar’s annual coupon report and 2013 shopper insights study while providing analysis and assessment to inform promotional planning for 2013.

1. #coupontrends

2. Devora Rogers
• Senior Director, Retail Marketing
Insights
• New to Inmar (and North
Carolina!)
• Previously with IPG Media Lab
and Shopper Sciences
• devora.rogers@inmar.com
• 336.770.3495
• Twitter: @devoraerogers Don’t forget to join us in the LinkedIn
Promotions Room!
© 2013 Inmar, Inc. All Rights Reserved. 2
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#coupontrends

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

4. Inmar’s Portfolio of Services
$20.4 billion
in transaction
value
700+
retailers
1000+
manufacturers
®
© 2013 Inmar, Inc. All Rights Reserved.
#coupontrends 4

5. Real-Time
Relationship
Platform
®
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#coupontrends 5

6. Don’t forget to join us in the LinkedIn
Promotions Room!
®
© 2013 Inmar, Inc. All Rights Reserved.
#coupontrends 6

7. ®
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#coupontrends

8. Key Takeaways: Distribution (in billions)
310
313
305 315
‘12 ‘11
300 320
DOWN 1.2%
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#coupontrends
Source: 2012 Inmar Coupon Report

9. Key Takeaways: Redemption
5
4
2011: 3.5B
3 2012: 3.0B
2
1 DOWN 14.3%
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© 2013 Inmar, Inc. All Rights Reserved.
#coupontrends 9
Source: 2012 Inmar Coupon Report

10. 200 2008 2009 2010
2011 2012
180
Distribution by Month
160
140
120
100
80
60
40
20
0
© 2013 Inmar, Inc. All Rights Reserved.
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#coupontrends 1010
Source: 2012 Inmar Coupon Report

11. 160 2008 2009 2010
2011 2012
Redemption by Month
140
120
100
80
60
40
20
0
© 2013 Inmar, Inc. All Rights Reserved. 11
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#coupontrends
Source: 2012 Inmar Coupon Report

12. Distribution vs. Redemption 180 Distribution
Redemption
160
140
120
100
80
60
40
20
0
®
© 2013 Inmar, Inc. All Rights Reserved.
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#coupontrends
Source: 2012 Inmar Coupon Report

13. Magazine On Page
1.2% Others
Internet 7.0%
0.4%
In-ad
2.6%
2012 Distribution
Free-standing
Insert
88.8%
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#coupontrends

14. Direct
Internet Mail
4.6% 3.7% Other
Shelf Pad
6.1%
2012 Redemption
15.6%
Electronic
Checkout
8.0%
Instant
Redeemable
18.1%
Free-standing
Insert
43.9%
© 2013 Inmar, Inc. All Rights Reserved. 14
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#coupontrends

15. Redemption down across the board
NON-
FOOD
FOOD
2.0
billion
1.0
billion
65.8% of Total 34.2% of Total
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© 2013 Inmar, Inc. All Rights Reserved.
#coupontrends 15
Source: 2012 Inmar Coupon Report

16. The redemption roller coaster (in billions)
4.4
3.9
3.7
3.5 3.5
3.3
3.3
3.2
3.0 3.0
2.6 2.6 2.6
®
© 2013 Inmar, Inc. All Rights Reserved.
#coupontrends 16
Source: 2000-2012 Inmar Coupon Reports

17. So what’s driving the
decline?
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#coupontrends

18. © 2013 Inmar, Inc. All Rights Reserved. 18
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#coupontrends

19. Paid Sunday newspaper subscription impact
Coupon Redemptions vs. Paid Circ
9.0 70.0
8.0
60.0
7.0
50.0
6.0
Billions of Redemptions
Millions in Circulation
40.0
5.0
4.0
30.0
3.0
20.0
2.0
10.0
1.0
0.0 0.0
1990 1991 1992 1993 1994 1995 1996 1997 1998 1999 2000 2001 2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012
Tot. Coupon Red. Paid Sunday News Circ
®
© 2013 Inmar, Inc. All Rights Reserved.
#coupontrends 19
Source: Editor and Publisher International Yearbook

20. January decline wipes out 2012 gains
Consumer Confidence Index – January 2002 through January 2013
120
Previous
110
Restated
100
90
90
80
70
60 58
50
40
30 25
20
2002 2003 2004 2005 2006 2007 2008 2009 2010 2011 2012 2013
© 2013 Inmar, Inc. All Rights Reserved. 20
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#coupontrends
The Conference Board - Nine census regions, 5,000 US households; 1985 = 100; conducted by Nielsen

21. CPG prices on the rise
5
Percent Change in Unit Prices
4
3
2
1
0
-1
-2
17 periods of price gains;
4.9% increase in latest period
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© 2013 Inmar, Inc. All Rights Reserved.
#coupontrends 21
Source: Nielsen Scantrack, (U.S. FDM w/ Walmart) 4 week increments (vs. prior year); UPC-coded

22. Consumers shifting spend or buying less
Alcoholic Bevs 6
Fresh Produce 4
HBA 1
Deli 1
Packaged Meat 0
Non-Food Grocery -1
Dairy -1
Fresh Meat -1 Unit Volume
Dry Grocery
General Merch
-2
-2
% change
Frozen Foods -2 vs. year ago
Total All Depts -1
®
© 2013 Inmar, Inc. All Rights Reserved.
#coupontrends 22
Source: Nielsen Scantrack, Total U.S. – All Outlets Combined, 52 weeks ending 12/22/2012 (vs. prior year), UPC-coded

23. Misery index improving…but not for younger
and less educated
Ages 20 to 24 years Age 55 and over
18 18
15 15
12 12
9 9
6 6
3 3
0 0
Dec. Jan. Feb. Mar. Apr. May Jun. Jul. Aug. Sep. Oct. Nov. Dec. Dec. Jan. Feb. Mar. Apr. May Jun. Jul. Aug. Sep. Oct. Nov. Dec.
2011 2012 2011 2012
High School graduates, no college Bachelor's degree and higher
18 18
15 15
12 12
9 9
6 6
3 3
0 0
Dec. Jan. Feb. Mar. Apr. May Jun. Jul. Aug. Sep. Oct. Nov. Dec. Dec. Jan. Feb. Mar. Apr. May Jun. Jul. Aug. Sep. Oct. Nov. Dec.
2011 2012 2011 2012
misery index = unemployment rate + inflation
®
© 2013 Inmar, Inc. All Rights Reserved.
#coupontrends 23
Source: Nielsen, 2012 U.S. Retail Trends U.S. Bureau of Labor Statistics; CPI non-seasonally adjusted, unempl. rate seasonally adjusted

24. Shoppers relying
on coupons to
help in down
economy
54% of shoppers say
they increased their
coupon usage because
their financial situation
changed
© 2013 Inmar, Inc. All Rights Reserved. 24
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#coupontrends
Source: 2013 Inmar Shopper Study

25. The payroll tax is back…
Will consumers feel the bite?
Average
$400-$2,200
a year
®
© 2013 Inmar, Inc. All Rights Reserved.
#coupontrends 25
Source: Congressional Budget Office

26. © 2013 Inmar, Inc. All Rights Reserved. 26
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#coupontrends

27. Offer Attractiveness
®
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#coupontrends 27

28. Marketers tightening budgets after hot ’11
2011
Q1 -3%
Q2 +4%
Q3 +16%
Q4 +5%
®
© 2013 Inmar, Inc. All Rights Reserved.
#coupontrends 28
Source: 2011 Inmar Coupon Trends

29. Marketing tactics impacting redemption
Average
Average Average Purchase
Redemption
Face Value Requirement
Distributed Distributed Period
Distributed
Distributed: Distributed: Distributed:
$1.56/coupon 1.57 units/coupon 2.2 months
(-1.9%) (+4%) (-8.3%)
“I usually won’t use a coupon if I have to purchase multiple items” 34.36%
“There are too many rules/exclusions for using coupons” 37.64%
®
© 2013 Inmar, Inc. All Rights Reserved.
#coupontrends 29
Source: 2012 Inmar Coupon Trends

30. Redemption period by method type
2012 Coupon Fact Book
Average Redemption Period Distributed by Method (in months)
Method 2008 2009 2010 2011 2012
Beginnings Magazine n/a 4.6 4.5 3.0 6.0
Bounceback 14.0 12.1 17.0 10.3 13.9
Color Run-of-press 2.9 2.9 1.7 7.3 2.5
Consumer Relations 13.8 10.9 11.1 3.3 5.0
Direct Home Delivery 6.0 3.5 3.5 4.4 4.7
Direct Mail 3.9 4.2 3.0 3.8 2.6
Direct Mail Co-op 3.9 3.3 3.0 2.8 2.7
Direct Mail with Sample 8.5 7.0 7.1 6.6 7.9
Electronic Checkout 4.5 4.6 4.5 4.6 4.0
Electronic Kiosk 3.5 3.5 4.5 3.8 2.1
Electronic On-cart 5.5 5.0 n/a n/a 1.0
Electronic Shelf 2.8 3.3 3.3 3.5 3.1
Free-standing Insert 2.6 2.3 2.2 2.1 1.9
Handout 6.6 6.8 6.4 6.3 6.2
Handout Co-op 4.4 3.8 3.8 5.2 2.4
Handout In-store with Sample 10.0 12.9 12.4 13.6 8.9
Handout Off-store Location 5.2 5.3 9.8 9.0 9.7
Handout Off-store Location Co-op 14.1 8.7 10.5 4.3 3.1
Handout Off-store Location with Sample 6.2 10.8 15.8 10.3 13.2
Hospital Sample 15.8 16.7 17.2 16.2 16.4
In-ad
In-pack
In-pack Cross Ruff
0.9
15.7
15.4
1.4
15.6
16.9
0.9
15.4
18.3
1.0
16.2
14.1
1.1
14.4
12.7
My coupons
Instant Redeemable
Instant Redeemable Cross Ruff
Internet
7.6
6.7
6.5
8.7
8.7
7.2
9.7
7.4
7.1
9.0
9.8
7.9
8.3
5.1
6.1
often expire
Magazine On-page
Magazine Pop-up
Military Handout
3.6
6.2
4.7
4.4
4.7
5.2
3.9
8.2
4.6
4.7
5.1
4.7
4.7
3.8
4.2
before I have
Military Magazine
Military Shelf Pad
Newspaper Co-op
5.5
8.1
5.0
3.2
8.3
2.4
4.3
7.7
3.7
3.4
8.0
1.5
3.9
7.7
n/a
the chance to use them.
Newspaper Run-of-press 2.9 1.9 2.8 2.5 3.0
On-pack 10.1 13.2 10.0 9.7 8.4
On-pack Cross Ruff 8.2 8.4 12.9 8.1 6.8
Prenatal 24.0 n/a 20.9 n/a n/a
Shelf Box 5.0 5.9 6.9 6.5 6.7
Shelf Pad 5.1 4.8 5.1 4.7 4.8
Sunday Comics n/a n/a n/a 3.0 n/a
Sunday Supplement 3.2 2.0 1.4 2.0 3.7
®
© 2013 Inmar, Inc. All Rights Reserved.
#coupontrends 30
Source: 2013 Inmar Shopper Study

31. New product trial dampening redemption
190 727 93
Manufacturers New Product Categories
Promoting New Event Dates in Featuring New
Products via FSI 2012 Product Events
in 2012 in 2012
(+9.9% over 2011) (+23.2% over 2011) (+13.4% over 2011)
“I can’t find coupons for the products I want to buy” 52.83%
®
© 2013 Inmar, Inc. All Rights Reserved.
#coupontrends 31
Source: Kantar Media (Marx)

32. Shopper Behavior
© 2013 Inmar, Inc. All Rights Reserved. 32
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#coupontrends

33. Changing shopper sentiment:
From effort to entitlement
“If I put in the effort, I can get
deals on the brands I buy.”
“If I shop a store a lot, I shouldn’t
have to work for deals I deserve.”
© 2013 Inmar, Inc. All Rights Reserved. 33
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#coupontrends

34. Shopper attitudes to coupons
65%
Don’t think they
should have to
80%
work for deals. Using coupons
makes me feel
smarter.
I would use
66% coupons more if
they were more I am not sure where
36%
available online. to get coupons for
the products that I
want to buy.
37% I wish all coupons
were digital.
© 2013 Inmar, Inc. All Rights Reserved. 34
®
#coupontrends
Source: 2013 Inmar Shopper Study

35. Why shoppers use coupons
Compared to 2011, shoppers reported coupon usage in 2012:
INCREASED STAYED THE SAME DECREASED
54% 41% 4%
© 2013 Inmar, Inc. All Rights Reserved. 35
®
#coupontrends
Source: 2013 Inmar Shopper Study

36. Shoppers want easy and personalized offers
“I want coupons loaded to my
65% store loyalty card for
products that I normally buy.”
65%
“I want stores to email me
with coupons for products
that I normally buy.”
“I want all available store
63% coupons to be loaded onto my
store loyalty card.”
© 2013 Inmar, Inc. All Rights Reserved. 36
®
#coupontrends
Source: 2013 Inmar Shopper Study

37. Rise of the Mansumer #mansumer
Participation in holiday meal planning
6%
Not involved
35% Share
59% All Decisions
86% 44% 40%
18%
Not involved
Share 44%
All Decisions
38%
®
© 2013 Inmar, Inc. All Rights Reserved.
#coupontrends 37
Sources: 2012 Inmar Holiday Study, KSDK, Men’s Health, Spike Network’s ‘State of Men’ study

38. Digital Fragmentation
© 2013 Inmar, Inc. All Rights Reserved. 38
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#coupontrends

39. One word to describe the digital offer
landscape
Artist credit: Morten Fangok Olesen
®
© 2013 Inmar, Inc. All Rights Reserved.
#coupontrends 39

40. 7 Ways to Receive a Digital Offer
1 2 3 4 5 6 7
Text
Message Brand,
Retailer
Email or
Publisher
Website
QR
Code
In Store
Social
Mobile
App
®
© 2013 Inmar, Inc. All Rights Reserved.
#coupontrends 40

41. How digitally discovered coupons are
redeemed
Redeemed like paper Paperlessly redeemed
Retailer Loyalty Program (i.e. eWallet/
Direct-to-Card / Save-to-Card)
Text Email Website Unique Identifier (10-digit mobile)
Loyalty Aggregator (AOL shortcuts,
SavingStar, etc.)
“Closed” Retailer Program (Target,
Social QR (et al) Apps Walgreens, Starbucks, etc.)
Manifests as a paper coupon Never manifests as paper
Redeems as a paper coupon Redemption recorded separately
Settles as a paper coupon
®
© 2013 Inmar, Inc. All Rights Reserved.
#coupontrends 41

42. So many choices or too many choices?
Source: MediaPost & Company websites
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®
#coupontrends

43. In 2013, the number of
retailer storefronts
which accept paperless
coupons is expected to
grow 50% or more
depending on channel.
© 2013 Inmar, Inc. All Rights Reserved. 43
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#coupontrends

44. Clips:
250 Million
Digital coupons
redeemed:
27.5 million
© 2013 Inmar, Inc. All Rights Reserved. 44
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#coupontrends
Source: 2012 Inmar Coupon Report

45. Average
redemption
rate:
11%
Average
face value:
$0.91
© 2013 Inmar, Inc. All Rights Reserved. 45
®
#coupontrends
Source: 2012 Inmar Coupon Report

46. Digital paperless coupon
distribution is on the rise
300
250.0
250
FSI
2011-15 CAGR
200 - 3%
Billions
150
Digital Paperless
FSI 99.0
100 2011-15 CAGR
Print at home 898%
Digital Paperless PAH
50
2011-15 CAGR
17% 3.0
0
2008 2009 2010 2011 2012 2015
®
© 2013 Inmar, Inc. All Rights Reserved.
#coupontrends 46
Source: 2012 Inmar Coupon Report

47. Conclusion section slide
®
© 2013 Inmar, Inc. All Rights Reserved.
#coupontrends 47

48. Slight to modest
Conclusion section slide
increase in redemption
volume over 2012
®
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#coupontrends 48

49. Thank you.
Questions?
Don’t forget to join us in the LinkedIn
Promotions Room!
®
© 2013 Inmar, Inc. All Rights Reserved.
#coupontrends 49

50. Devora Rogers
devora.rogers@inmar.com
336.770.3495
@devoraerogers
@InmarInc