MARTIN SLOANE | Supermarket Shopper Stores wage war with double coupons
Supermarket double-coupon promotions have been around for more than two decades. In some parts of the country, they are rare events -- some of my readers have never seen double coupons! In other areas, double coupons appear frequently, if not constantly. Smart Shoppers call it "coupon heaven" and over the years, double coupons have saved consumers billions of dollars.
However, much as they are enjoyed, many shoppers are still unsure of what these promotions really are. For example, a reader recently complained that she has frequently asked her supermarket to offer a double coupon promotion and her requests have been ignored. A reader in Rochester, N.Y. -- an area where double coupons are always offered -- asks why the face values of the coupons in his Sunday inserts are usually higher than the double-coupon offers.
To understand double coupons, consumers need to be aware of several things: First, supermarkets hate double coupons. Second, shoppers should recognize that supermarkets that offer double coupons will make every effort to reduce the number of coupons they double.
The offer to double the face value of manufacturers coupons is the most powerful promotion a supermarket can use. This is due to the billions of coupons distributed by manufacturers and their high values. It is also because clipping coupons has become a way of life and the greatest grocery savings tool for 60 million smart shoppers. For the supermarket it is also a very costly promotion and I will explain the impact later.
When the first supermarket in an area offers double coupons, it is usually because it recognizes the power of double coupons and wants to attract shoppers from competitive stores. The supermarket that offers the advantage of double coupons will see new shoppers walk into their store. Other supermarkets in the area may try to ignore it, but they can't stand on the sidelines too long and lose sales. Soon, they must join in. When they do, double coupons become a coupon-price war. Wars can escalate and competing supermarkets begin to up the ante; a 50-cent limit can jump to 75 cents or a dollar. When the war intensifies, double coupons can become triple coupons. Double coupons are a very costly promotion for supermarkets. Exactly half of the doubled value consumers receive comes from the supermarket's own pocket. Industry sources estimate the cost at 3 percent of sales, about twice the typical net profit made by supermarkets.
Every time a smart shopper like Pat Hammonds in Long Beach, Calif., shops and receives double coupons savings from Ralphs, the chain's purse is that much lighter. When Ralphs doubled her $1 Gerber coupon, it cost Ralphs $1, considerably more than the profit it made on the sale of eight jars of baby food. When every chain in an area is caught up in a double-coupon war, they are all losing money and gaining nothing. Each chain has to decide what it will do about it. If no chain wants to "go first," and end the promotion, it can do some things to reduce the cost of double coupons.
United Feature Syndicate