![]() In making the announcement, Steve Sanger, General Mills chairman and chief executive officer, said he expects the cereal category to benefit from “lower everyday prices and less inefficient promotional spending.”Īnd two weeks ago, Quaker Oats announced it will cut prices by 15% on its ready-to-eat cereals.įor the short term, however, coupons appear to be a firm fixture in American life. General Mills reacted by reducing its prices an additional 11%. Last month Kellogg followed suit by announcing it was cutting prices on 16 popular brands by an average of 19%. But when Kraft Foods’ Post division made its bold move to capture a larger share of the breakfast cereal market in April, it reduced prices on its 22 cereals by 20%. The current cereal wars may be another indication of how competition is being fought with everyday prices. “While may not clip that coupon, will flip through the Sunday inserts to look at the new products.” “A coupon is an advertisement as well as a coupon,” he said. Two years ago, General Mills cut $175 million out of its spending for coupons and promotion and reduced prices of all its products by 11%.ĭavid Dix, a spokesman for the company, which makes Cheerios and Wheaties, said it intends to continue offering coupons, however. Lowering prices across the board may be a better way to lure customers and engender loyalty, said Procter & Gamble’s Moore. “The trend is to look for ways to target coupons.” ![]() “They’re just being thrown up against the consumer,” he said. ![]() Syndicated consumer columnist Martin Sloane agrees that distributing coupons through Sunday newspaper inserts is too scattershot to be effective. People who use coupons usually buy whichever brand they have a coupon for. In addition, coupons tend not to accomplish what they set out to do-create brand loyalty, Lempert said. We would agree there must be a better way.” “And the benefits only go to those who clip them. “Couponing costs us a tremendous amount in promotional dollars,” Natale said. Some stores lure customers by offering double coupons-meaning the supermarket will redeem twice the face value of the manufacturer’s coupon-and sometimes even triple coupons.Įven so, the average savings from coupons for a Wegmans customer is only $36 a year. Yet they feel guilty that they’re not taking advantage of the value.”Ĭoupons are a burden to supermarkets because of the cost of processing them and the competitive environment they have fostered. They don’t have the time to clip them, file them and retrieve them. “There are an equal number of customers who really see coupons as a pain in the neck. “We have a number of customers who want coupons to continue. “Certainly there are customers who are not happy,” Natale said. Moore would not say how long Procter & Gamble’s experiment in northern New York would continue nor how Procter & Gamble would determine whether it was a success or failure.īut Jo Natale, a spokeswoman for Wegmans, a major supermarket chain in the region, said some of its customers have phoned to complain. and Kimberly-Clark also had announced intentions to test market the no-coupon idea but decided against it. “We want to be sure there’s a healthy and competitive marketplace for consumers.”Ĭlorox Co. “We’re looking to see if there was any collusion on the part of manufacturers or retailers,” she said. are targets of the investigation, said Jennifer Farina, spokeswoman for New York Atty. The move has prompted an investigation by the New York state attorney general’s office for possible antitrust violations. There’s nothing effective about an industry that fails 98% of the time.” “We have worked to eliminate waste in all parts of our business. “Here is a practice that fails 98% of the time,” said Elizabeth Moore, a spokeswoman for Procter & Gamble. The business of producing, distributing and processing coupons has grown to a $6.5-billion industry that churns out 300 billion coupons a year. And as the Times Food section reported recently, some companies are introducing coupons over the Internet.įew, however, would argue that coupons have become an extravagant practice for both the companies that offer them and the supermarkets that accept them. While the search for alternatives goes on, one newspaper industry source says coupons will remain with us for the foreseeable future, especially in competitive categories. Not all industry experts agree with Lempert’s prediction.
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