Minneapolis, MN, January
30, 2006 - 'Buy One Get One Free' (BOGO) Free Standing Insert (FSI)
promotions increased 48 percent to 9.4 billion over 2005, according
to Marx Promotion Intelligence/TNS Media Intelligence. The large
increase was fueled primarily by three segments: Household Products,
Dry Grocery and Health Care, where BOGO FSI promotions grew by 63%.
The information was released today in "Buy One Get One Free
(BOGO) Promotions: a Growing Trend in FSI Promotion", the latest
Promotion Guidepoint© paper from Marx Promotion Intelligence.
Marx Promotion Intelligence, a TNS Media Intelligence company, is
considered the industry standard for tracking FSI coupon activity.
"Through the increased use of FSI BOGO offers, manufacturers
are implementing varying strategies depending on the product and
category," said Andy Rumpelt, vice president of Business Development
& Marketing at Marx Promotion Intelligence. "Health care
and personal care manufacturers are becoming more aggressive by
offering free refill-type cartridges with the purchase of base units.
Additionally, food manufacturers are leveraging high equity brands
to drive trial on other products, as well as fill up the kitchen
cupboard with higher multiple purchase requirements to get the free
item."
BOGO coupons have increased in both volume and face value over
the last several years as manufacturers aggressively use BOGO coupons
to deliver 'value', drive volume, retain loyalty, and build share.
In 2005, there was a significant increase in non-food categories,
which grew by nearly 80 percent; fueled by major household products
companies like Proctor & Gamble, Reckitt Benckiser and S.C.
Johnson & Sons (Figure 1).
BOGO Coupons Dropped (Millions)
2005 vs. 2004 Year |
Food |
3,440 |
4,186 |
747 |
21.70% |
Non-Food |
2,940 |
5,289 |
2,349 |
79.90% |
Total PG |
6,377 |
9,418 |
3,042 |
47.70% |
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The average BOGO coupon value also continues to rise, largely due
to increased BOGO promotion on higher ticket items in non-food categories.
Overall, the average BOGO face value increased to $3.33 in 2005,
a jump of 118 percent versus $1.53 in 2002 (Figure 2).
The average face value of a non-food BOGO is now $4.57 versus a
$1.75 for food.
Average BOGO Face Value Trends
2002 Through 2005 Year |
Food |
$1.21 |
$1.43 |
$1.34 |
$1.75 |
Non-Food |
$2.60 |
$3.94 |
$4.34 |
$4.57 |
Total CPG |
$1.53 |
$2.20 |
$2.72 |
$3.33 |
|
Across all of CPG, the most popular BOGO offer is 'Buy 2 Get 1
Free' and represents 45 percent of all BOGO offers. Within the Sectors,
non-food BOGO offers tend to be smaller purchase requirements as
compared to food items (Figure 3). The longer purchase
cycle for non-food items and higher price points support the lower
purchase requirement amounts. In contrast, food items, which include
pet food, have much shorter purchase cycles and lower price points,
which lend these items for pantry loading and high multiple purchase
offers.
BOGO Purchase Requirements
% of Total BOGO Coupons Dropped
2005 Year |
1 Unit |
6% |
13% |
2 Units |
38% |
64% |
3 Units |
27% |
13% |
4 Units |
9% |
9% |
5 Units or More |
20% |
1% |
|
With the average face value of traditional cents-off coupons continuing
to rise, BOGO offers will continue to be a viable option in the
FSI consumer promotions mix. BOGO FSI promotions deliver a clear
message to consumers of value, generally with the word, 'FREE',
highlighted in the offer. BOGO promotions also increase awareness
and enhance the ability of the sales force to garner stronger retailer
support through enhanced merchandising and sufficient shelf and
back room stock.
About Marx Promotion Intelligence
Marx Promotion Intelligence is the industry standard for tracking
Free Standing Insert (FSI) coupon activity. Marx provides end users
with real-time information and the tools to understand and act on
the latest consumer promotion trends.
For additional information on this topic or other key consumer
promotion issues, please contact Marx Client Services at (952) 925-5272
or visit the Marx website at www.tnsmi-marx.com.
About TNS Media Intelligence
TNS Media Intelligence in the U.S. is the leading provider of strategic
advertising and marketing information - across media, brand, industry
and market. The company's tracking technologies collect occurrence
and expenditure data on more than 2.1 million brands spanning 20
media. The U.S. headquarters are located in New York City with sales
locations in major markets across the country.
For further information, including this and prior press releases,
please visit www.tns-mi.com.
About TNS
TNS is one of the world's leading providers of market information.
The company delivers strategic market measurement, analysis, insight
and advice to many of the world's largest organizations and most
recognized brands. TNS' research helps its clients better understand
the needs and wants of their customers, and its capabilities span
market segmentation, advertising and communications, new product
development, brand performance and stakeholder management. The company
is also one of the leading providers of social and political polling.
From its global network that spans 70 countries who together conduct
research in more than 110 countries, TNS allows for local expertise
and knowledge to be combined together with internationally consistent
information and analysis.
TNS is listed on the London Stock Exchange (TNN) and is a trade
mark of Taylor Nelson Sofres plc. Further information can be found
on www.tns-global.com.
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