Coupons... Another Blow to Print Media?

Take a look at this from Mediapost and decide for yourself:

Is Digital Coupons' Rise Print Inserts' Demise?

Erik Sass, Feb 17, 2010 03:53 PM

Digitally delivered coupons are growing fast while printed newspaper inserts are increasingly threatened, according to separate surveys by Coupons.com and the Newspaper Association of America. The findings of the two surveys suggest that newspaper coupon inserts could be in danger of experiencing the same long-term decline that has afflicted print classifieds. Things are looking up for digital coupons, according to Coupons.com, which said its digital coupon business grew 170% in 2009 compared to 2008, in terms of the volume of savings. Coupons.com allows consumers to find coupons they want and print them out at home, download them to mobile devices, or transfer them to store loyalty card accounts for later retail redemption. The total volume of coupons redeemed from the Coupons.com network reached $858 million in 2009 -- up from about $320 million in 2008 and about $140 million in 2007, for a total increase of over 500% in just two years. Overall, 45 million consumers used digital coupons in 2009 -- up almost 20% from 38 million in 2008. In percentage terms, that represents an increase from about 12% to 14% of the total U.S. population. Of this group, 13.1 million are exclusive digital coupon users, meaning they don't clip coupons from the newspaper -- up about 39% from 9.4 million in 2008. In short, while the overall number of digital coupon users and the number of digital coupon-only users are both increasing, in proportional terms, the latter is increasing faster -- suggesting that some print coupon users may be abandoning the old format for digital. Coupons.com also found that digital coupon users were more affluent and better-educated than the average American. They had an average household income of $97,000 -- 23% higher than the national average -- and 34% have a college degree compared to 27% of the overall population. Turning to newspaper inserts, the outlook isn't quite so cheery, according to a white paper released by the Newspaper Association of America and Kannon Consulting, whose main points were summarized by Rick Edmonds at Poynter Online. (The white paper is only available to NAA members.) According to Edmonds, the white paper said newspaper inserts are "under siege," with big retailers like Sears demanding double-digit rate cuts and the CMO of J.C. Penney's expressing concern that prepaid inserts don't reach as many younger consumers. This is a growing threat to newspapers' retail advertising, the NAA-Kannon study noted -- especially as the cost of printing and distributing coupons has gone up with the price of paper, ink and gasoline. Perhaps most importantly, Edmonds said the study chastised newspaper publishers for lagging behind in developing more authoritative and precise metrics for ROI for preprint inserts. They need to offer advertisers tighter targeting; for example, at the ZIP code level.

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