Shop Talk

Check Out Line: April showers bring May shoppers

Check out the recent rise in U.S. sales.

U.S. chain store sales rose 3.3 percent last week versus a year ago, according to new data from Redbook.  The sales were also up 0.8 percent in May so far versus April, Redbook’s figures on general merchandise retailers with about 9,000 U.S. stores showed.

That’s a bit brighter than the 0.5 percent rise in April same-store sales we saw last week, based on 28 chains.

Meanwhile, consumers are getting tech-savvy about their food shopping.  Deloitte said that more consumers are turning to their computers to look for deals on food.  According to the firm’s 2010 Consumer Food Safety Survey, 33 percent of people have signed up to get emails, recipes or coupons from food makers, a 6 percentage point rise from just two years earlier.

Deloitte found that food shoppers also feel the quality of store, or private label, brands is better.  Fifty-five percent of those surveyed said they are buying store brands because they believe the quality is comparable to national branded foods, up 14 percentage points from 2008. Six percent even said the quality is better than national brands.

Also in the basket:

Church & Dwight tops expectations

Coupon use up 27 pct last year-Inmar

U.S. consumers’ use of coupons soared 27 percent last year as they sought relief from a tough economy, according to a report released on Monday by Inmar, which tracks coupon use.

In 2009, consumers redeemed about $3.5 billion in coupons.  Shoppers used 3.3 billion coupons for everything from laundry detergent to cereal, about 700,000 more than in 2008. The internet drove much of the growth, as online coupon redemption spiked 360 percent.

Marketers, desperate to stoke sales, enabled that, issuing a record number of coupons, on and offline, putting out 367 billion coupons with an average face value of $1.44 each last year. But expiration periods were about 10 percent shorter in 2009, apparently in a bid not to make the deals too sweet.

(Reuters photo)

J.C. Penney discounts go mobile

J.C. Penney discounts are going mobile as the department store takes aim at younger, tech-savvy shoppers.

Just in time for the crucial holiday shopping season, the company is testing a discount program from Cellfire that will allow Penney’s Houston-area shoppers to use their cell phones to download coupons that can be presented at checkout for savings.

The move comes as Penney gears up for the holiday shopping season — a crucial sales period for department stores and other retailers.

“It’s another way we’re innovating to enhance the customer’s shopping experience,” Mike Boylson, the company’s chief marketing officer said in a statement.

J.C. Penney’s test currently is limited to the Houston metro area. A promotion on Cellfire’s website reads: “Take $10 off a single purchase of $25 or more in store, jcp.com & catalog when you use your JCPenney card.”

Cellfire’s website also shows coupons for other area stores stores such as Sears and Kroger.

Shoppers who have downloaded Cellfire will have access to the same discounts that Penney sends via snail mail, and new offers will be available nearly every week. 

Starbucks’ cafe-to-market coupons

Starbucks cafes in the United States are handing out a limited number of coupon books designed to drive its cafe customers to grocery stores where the coffee chain’s ice cream, bottled drinks and coffee beans are sold.

“We started in the coffee aisle. But the other aisles got jealous. So now, we’re all over the grocery store,” reads the little brown book of coupons, available now in company-operated stores.

The books include discounts like $1 off ice cream pints, $2 off bottled Frappuccino drinks or $1 off 10- or 12-ounce bags of coffee.

Licensed stores, such as those operated in grocery stores and book stores, will get the coupon books on Friday, Starbucks spokesman Alan Hilowitz said.

The company said its latest effort is an “evolution” of its long-standing efforts to promote cafe products in grocery stores, and vice versa.

For example, when the company launched its new daily brew Pike Place last year, grocery shoppers who bought a bag of the new blend got a coupon code at check-out that entitled them to a $5 Starbucks gift card.

Similar efforts are percolating overseas.  In Switzerland, Starbucks is giving away a voucher for a free espresso beverage with packages of coffee purchased in supermarkets. The promotion will travel to the United Kingdom, France and Germany later this year.

Check Out Line: Discounts, the choice of a new generation

Check out the “Downturn Generation.”    That’s what data tracking firm Information Resources Inc is calling a “new generation of Americans (that) is adopting practices similar to Depression-era shoppers, implemented both to weather the recession and to keep a close eye on spending long after the recession ends.”   Basically, we want everything on sale.  And that means lots and lots off the original price.  The New York Times today pointed out how retailers are pushing deep discounts of 50 percent or more to attract shoppers.

According to IRI’s study, more than 69 percent of consumers surveyed say they are more likely to look through retailer ads for deals and nearly 82 percent are more likely to look for sale prices once in the store.   Also, it’s not just one store they are looking at.  Fifty-nine percent visit multiple stores for the lowest prices, and 42 percent of those shoppers will continue to do so into the future.   Just under two-thirds (65 percent) say price is becoming more important than convenience in brand purchases.   Oh, and along with this new frugality comes another benefit: sharing is in and for some people it could stay.

Thirty percent are making bulk purchases with others not in their households to secure low unit prices, and 35 percent of those shoppers intend to continue doing so.  At the same time, more than 34 percent are collecting, sharing and trading coupons with others, with 40 percent of those shoppers planning to continue this behavior.   Also in the basket:   Price fixing takes a hit (Wall Street Journal)   Office Depot posts loss   Fortune Brands to cut payout, affirms ’09 outlook   Under Armour posts stronger than expected profit   Coke Enterprises profit, outlook tops view   DineEquity posts higher profit   David Beckham designs (WWD)

(Reuters photo)

Check Out Line: Love those coupons

Check out how U.S. consumers are eyeing their junk mail ever more closely for coupons to save money during the recession, particularly on groceries and entertainment.

Consumer expect a 10 to 25 percent discount in coupons sent by mail, according to a study by U.S. mail services provider Pitney Bowes and DMNews, a trade publication that covers direct marketing.

“In times such as these, coupons sent by mail are an effective way to relieve pressure on a household budget,” Pitney Bowes executive vice president Leslie Abi-Karam said in a statement. “The research clearly shows that consumers have come to depend on the cost savings associated with coupons sent by mail.” 

Some of the study’s findings:

* 95 percent of Boston residents use coupons to put food on the table. Nearly half of Bostonians expect a 10 percent discount on groceries, but they have higher expectations for discretionary purchases like electronics or travel, where they anticipate a 25 percent discount. 

* 70 percent of residents in culture-rich New York City are more likely to redeem a coupon for entertainment, and one-quarter of them expect more than 25 percent off for a show ticket. Meanwhile, in a city with strong public transportation and so many taxis, residents are least likely to redeem a coupon for auto parts and services.

* In Los Angeles, 43 percent expect only a 10 percent discount on entertainment. Meanwhile, 84 percent of residents are most likely to use coupons on groceries and 49 percent are least likely to use them on travel.

Check Out Line: Back to basics

Check Out those price cuts.

While the holiday season celebrations have ended, shoppers are still bargain-hungry.  We haven’t seen major price cuts on hot items like the iPhone or Wii, though there does seem to be a trend brewing in bargain basics.

Here are just a few of the deals announced so far this week:    Pennsylvania-based Weis Markets cut prices on thousands of items for 90 days at its 155 stores.      “With consumer confidence at an all-time low and the poor economy, we know that our customers are looking for long-term ways to save money,” said Weis Markets President David  Hepfinger.

Whole Foods, longing to shed the “Whole Paycheck” nickname, just issued its latest Whole Deal circular that includes tips such as how much different types of grains cost per serving. There are coupons too, for basics like frozen pizza and vitamins.

It isn’t just a U.S. phenomenon. Wal-Mart’s Asda, the No. 2 supermarket in Britain, is cutting prices on at least 1,000 items. Asda said it is selling 200 health and beauty products like shampoo and deodorant and 100 frozen food items for 1 pound ($1.46) each.

Also in the basket:

Japan shoppers grab lucky New Year bags amid gloom

Scissor savings

Procter & Gamble is giving the gift of old school home economics this holiday season — coupons.

P&G, the world’s biggest consumer products company and advertiser, wants cash-strapped consumers to keep buying its products.  Its sales growth has slowed as shoppers use up what they have in their pantries rather than go out and buy more detergent and deodorant.

Now, P&G (named after founders William Procter and James Gamble, shown in cardboard cutouts above) is offering more coupon circulars that go out with Sunday newspapers.  Shoppers who shop and then do a little homework (using that home ec education) can save even more.

The company has issued 14 circulars each year over the past two fiscal years. This fiscal year it plans to send out 17 such circulars, including two in December instead of the one it had planned for this month.  This past Sunday’s circular included more than $45 worth of coupons.

A spokeswoman said consumers have been asking for more coupons and better ones.

Consumers who buy $50 worth of P&G products and send in those receipts get a book with coupons for up to $122 off their next purchases. Those coupons include as much as $5 off of certain Olay moisturizers.  This is the first time P&G has offered such a book.      “Our sense is that coupons are being used more,” a P&G spokesman said. “They want to cut back, but they also want the brands that they want.”   Readers, are you clipping more coupons these days?

(Reuters photo)

Drift to thrift

As the economy founders and the ranks of unemployed grow, shoppers are embracing their inner thrift. According to a new survey of 1,500 U.S. adults from WSL Strategic Retail, 52 percent of respondents agreed with this statement: “I’m proud of all the little ways I’ve found to save money.”

More than half of the participants were using more coupons and reading store circulars more closely. Sixty-two percent said they are more likely to wait for a sale before making a purchase.

Home cooking is back in fashion and so are leftovers — a trend supported by strong sales at companies like Kraft and weak sales at restaurants.

More than half of women polled said they were avoiding stores where they tend to overspend.

When its comes to paying the bill, 35 percent of the shoppers said they were less likely to use credit cards to pay for purchases. On the other hand, some said their credit cards were helping them get from paycheck to paycheck. So, it follows that 24 percent of respondents said they owe more on their cards than a year ago.

The money saving tactics go beyond stores. The survey also showed that people are doing more housework, from cleaning to gardening.

“True thrift is the intelligent use of time and money and we see it becoming a major trend to survive in these trying times … and likely a longer-term change in culture,” WSL said.

Women plan to spend less at department stores, mass merchants

Last month, in a poll conducted by SheSpeaks, a women’s insights marketing firm, almost 50 percent of respondents said they would spend less this holiday. That was up from nearly 30 percent who answered the same way last year.

In a new poll, SheSpeaks asks where shoppers intend to spend fewer dollars. Here are the results from the updated poll:

If you are planning to curb your spending, where will you be spending less money?  1 – Department Store (37.64%)  2 – Mass Merchandiser (Wal-Mart, Kmart, Target)   (23.62%)  3 – Big Box Retailer (Home Depot, Staples, Toys R Us, etc.) (16.85%)  4 – Grocery Store  (11.50%)  5 – Club Store (Costco, Sam’s, etc.)  (3.94%)  6 – Discount Store (TJ Maxx, Filene’s, etc.) (4.41%)  7 – Drug Store  (2.05%) 

Aliza Freud, founder of SheSpeaks, said she was surprised by the high percent of respondents who said they would cut their spending at mass merchants like Wal-Mart and Target. Wal-Mart’s results have been outpacing rivals in recent months as consumers seek out its low prices.

But Freud said: “People are feeling like they’re not getting the deals that they really expected to get there.” She said one reason for this feeling may be the lack of coupons that these retailers distribute. Instead of relying on a retailers’ promise that they offer low prices, Freud said respondents indicated that they prefer shopping with coupons these days to feel as if they are getting the lowest prices possible.

“We think coupons are a huge opportunity right now for retailers,” Freud said.

(Photo: Reuters)