Spending on coupons and other promotions distributed through free standing inserts dropped 12% to $47.5 million in 1993, according to a survey conducted for Advertising Age by Promotion Information Management, Chicago. The number of coupons distributed also dropped during the period, by 6% to 3 billion.
PIM measures promotions in major product categories on a continual basis by independently monitoring manufacturer coupons offered in newspapers, consumer magazines and direct mail.
Twenty-seven of the top 43 cookie companies had three or fewer promotions in 1993 and 17 of the 43 reduced the number proof motions they ran last year.
Nabisco Biscuit Co., the leading cookie marketer, saw the most substantial decrease in promotion spending. Although the company is the category's most active promoter, it sliced spending by 17.9% to $14.6 million last year.
The number of coupon programs decreased by 27.7% to 60 last year and coupon circulation slipped 2.3% to 899.1 million.
"We've been switching the emphasis in our marketing mix," said Ann Smith, manager-product communications for Nabisco. "We're spending more on advertising, and we're changing the kinds of coupon promotions we do. We want more targeted, more regional and more event-oriented efforts."
Nabisco handles promotions in-house and uses agencies on a project basis.
Growing private-label sales, category competition and consumers' recessionary concerns created a price-driven climate well-suited to couponing for the cookie category in the late 1980s and early '90s. Today, companies are looking for brand building promotions that make the most efficient use of marketing dollars.
"We've researched to find those geographic areas that make the best sense for couponing," Ms. Smith said. "We're pinpointing instead of blanketing the country with coupons. Coupon redemption is extremely low, something like 3%. With the cost of national FSIs, companies see there can sometimes be a better way."
Coupons remain important to introducing new products, marketers say. No. 2 ranked Keebler Co. showed a slight increase in promotion spending for 1993-up 3.5% to $11.8 million-mainly because of product launches like Raisin Ruckus, Sandies and P.B. Fudgebutters.
"Companies are using coupons for product introductions, but they're also increasingly looking to more targeted tactics like in-store sampling," a Keebler spokesman said. "On our established brands, we're beginning to use fewer coupons in favor of other tactics, and that's consistent with the industry overall."
Leo Burnett USA, Chicago, is agency of record for Keebler's promotions.
General Mills shot up to the No. 3 position in promotion spending last year after entering the market in 1992 with Dunkaroos and $800,000 in spending. The company spent $6.4 million last year, in large part to launch FundaMiddles.
It handles promotions in-house and taps agencies for projects
Even General Mills' promotions sought a new spin on couponing. One effort for FundaMiddles didn't expire for 20 weeks, much longer than the industry average of 12 weeks. And coupons for both brands had unusually high values, including $2.50 a box and two-for-one offers.