Even Homer Simpson knows America is in the middle of a recession. Doh!
While the tight economy truly sucks, we're seeing one big advantage: Many consumers have returned to the frugal ways our grandparents used during the Great Depression. Such practices as re-using plastic bags, limiting or abandoning credit card use, and using coupons to stretch our budgets have become ingrained.
In fact, coupon use has grown so monumentally the statistics for 2009 are staggering.
This trend started in October of 2008 -- coinciding with news of the U.S. financial crisis -- and led to 15 months of double-digit growth. Here's what's happening behind the scenes.
1. More Manufacturer Coupons
While consumers used an amazing $3.5 billion worth of coupons, brands did their part by supplying an unprecedented number of incentives. Despite the tight economy, manufacturers boosted their coupon offerings to the highest level recorded since such data has been tracked. Brands issued 367 billion coupons with an average face value of $1.44.
2. Internet Coupons Emerge
Online coupons nearly doubled in distribution, with companies releasing 92 percent more in 2009 than 2008. Google reported "coupons" was the number-one search term on its list of economy-related queries for 2009, followed by "unemployment," "stimulus plan," "Cash for Clunkers" and "student loans."
3. Reduced Average Savings
At the same time brands increased their coupon output, manufacturers also tried to mitigate lost revenue by maintaining coupon face values and shortening expiration periods. In 2009, the face value of the average coupon declined by a penny, reversing a multi-year trend of increasing values. Expiration periods were shortened by 10 percent in 2009, despite years of virtually no change.
4. Groceries Drove Early Growth
Food takes a big bite out of consumer budgets, so it makes sense grocery coupons drove the majority of increases in the first half of the 2009. Food manufacturers saw this trend and offered more coupons to minimize losses to low-price competitors and in-store brands. The top 10 Google search categories for 2009 were:
5. Non-Food Coupon Use Continued Growth
The economic future looked less grim by mid 2009 and coupon use expanded from food and basic essentials to include small household luxuries. Using grocery coupons also helped educate Americans to the savings available. As a result, coupon redemption grew by 40 percent in the second and third quarters for non-food products.
6. What's Next
It's impossible to predict how long this situation will continue, but it does appear the recession has led Americans to make fundamental changes in how they save and how they spend. The economic downturn instilled a drive to be smart and frugal about spending and coupons definitely played a role.
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