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  Contact Details:
Mark Nesbitt
Marx Promotion Intelligence
Phone: (952) 252-9934
July 16, 2008
Free Standing Inserts (FSI) Weighted Average Face Value Increased 7.5 Percent to $1.34 During First Half of 2008
More than $173 billion in FSI consumer incentives distributed

MINNEAPOLIS, MN July 16, 2008 – The Weighted Average Face Value (WAFV) for Free Standing Insert (FSI) coupons increased 7.5 percent to $1.34 in the first six months of 2008. This increase has become the highest WAFV on record according to Marx Promotion Intelligence, a division of TNS media intelligence.

“In the current climate of economic uncertainty, this new record particularly highlights the importance of promotional strategies to drive consumer demand,” said Mark Nesbitt, chief operating officer at Marx Promotion Intelligence/TNS Media Intelligence.

Marx Promotion Intelligence, the industry standard for tracking FSI coupon activity, reports that WAFV across the Non-Food segment of the Consumer Packaged Goods (CPG) industry increased 5.4 percent to $1.61, driven by the 17.7 percent increase within the Health Care area. WAFV across the Food segment increased 5.6 percent to $0.91, led by the 13.7 percent increase for the Dry Grocery area. All other areas across the Non-Food and Food segments decreased in WAFV for the first half of 2008.

Manufacturers delivered more than $173 billion in consumer incentives as part of 129 billion coupons distributed across more than 101 billion pages during the first half of 2008. Additionally, retailer participation in FSI promotions increased 31.3 percent to over 21.2 billion pages during this period, driven in part by the growth of “co-equity” events that frequently deliver retailer-specific coupons rather than traditional manufacturer coupons.

“Manufacturers continue to leverage FSIs as an effective advertising vehicle to deliver consumer impressions and reinforce brand messaging,” said Mark Nesbitt. “Leading retailers are also increasing their use of FSIs to drive planned shopping trips and build shopper loyalty. Manufacturers and retailers are working together to deliver relevant incentives to their consumers and shoppers during increasingly difficult economic times. Although ‘shopper marketing’ tactics are still evolving, FSIs have definitely emerged as a key component of manufacturer and retailer cooperative consumer promotion support.”

Overall FSI Activity
During the first half of 2008, more than $173 billion in consumer incentives were delivered via FSIs in Sunday newspapers, up 3.8 percent from the same period in 2007. During the same six month period, over 129 billion coupons were distributed within more than 101 billion FSI pages. These trends translate into manufacturers delivering more value within each FSI event to stimulate consumer interest and generate category excitement.

First Half 2008 Results versus First Half 2007
Measure First Half 2008 % Change
Dollars Circulated $173 billion 3.8%
Coupons Dropped 129 billion -3.4%
Pages Distributed 101 billion -1.1%
Face Value (average) $1.34 7.5%
Fuse (weeks) 10.2 1.7%
Sector Activity
The CPG sector remains the largest user of FSI pages with a 70.1 percent share, followed by Direct Response, which includes general advertising activity, and Franchise, comprised of restaurants, portrait studios, and other businesses. FSI Pages Distributed increased for both the CPG and Franchise sectors, up 0.5 percent and 1.0 percent respectively. Pages Circulated for the Direct Response sector decreased 6.7 percent which was the sole driver of the 1.1 percent decrease in Pages Circulated for the FSI industry overall.
First Half 2008 Results by Sector versus First Half 2007
Sector Pages % Change Share
CPG 71,381 0.5% 70.1%
Direct Response 21,407 -6.7% 21.0%
Franchise 9,104 1.0% 8.9%
Total 101,892 -1.1% 100.0%

CPG Non-Food vs. Food
In the first half of 2008, Non-Food categories distributed more than 79.6 billion coupons which represented an increase of 2.5 percent versus a year ago, while Food categories distributed 50.0 billion coupons which represented a decline of 11.4 percent. Health Care and Personal Care were the only two areas with increases in Coupons Dropped during this period.

Manufacturers increased the value of the offers that were delivered to consumers in both the Non-Food and Food segments. WAFV for Non-Food increased 5.4 percent to $1.61 and was combined with a 2.0 point decrease in Multiple Purchase Requirements (MPR) resulting in Weighted Average Face Value Per Unit (WAFVPU) increasing 7.4 percent to $1.43. Similarly, WAFV for Food increased 5.6 percent to $0.91 and was combined with a 3.2 point decrease in MPR resulting in WAFVPU increasing 8.4 percent to $0.70. Manufacturers also increased the expiration lengths of these offers for the first time since 2005, up 3.2 percent to 9.8 weeks for Non-Food and up 0.7 percent to 10.8 weeks for Food categories. This increase appears to be a response to economic pressures to increase the consumer value per unit, decrease the total investment required for a qualifying purchase, and extend the offer period to align with consumer purchase cycles and manufacturer promotion cycles.

  Coupons Dropped(MM) Avg Face Value Avg Value Per Unit % Multiple Purchase Avg Duration
Area 1st Half
% Chg 1st Half
% Chg 1st Half
% Chg 1st Half
1st Half
% Chg
Non-Food 79,626 2.5% $1.61 5.4% $1.43 7.4% 15.2% -2.0 9.8 3.2%
Food 50,040 -11.4% $0.91 5.6% $0.70 8.4% 36.5% -3.2 10.8 0.7%
Total CPG 129,443 -3.4% $1.34 7.5% $1.15 10.1% 23.4% -3.0 10.2 1.7%

* % Multiple Purchase Requirements Point Change based on first half 2008 versus calendar year 2007.

Top 10 FSI Product Types in First Half 2008 (by Coupons Distributed*)
The top 10 product types based on coupons distributed accounted for 35.8 percent of all FSI coupon activity during the first half of 2008. Household Cleaning Products ranked first and increased 5.4 percent to distribute more than 7.5 billion coupons, with 530.7 million coupons being associated with nine new product introductions during the first six months of 2008. Vitamins moved to fourth place with a 28.3 percent increase to 5.0 billion coupons. This increase is due in part to 248.1 million coupons supporting eight new product introductions during this period.

    Coupons Dropped (MM)
Rank Product Type 2007 (1st Half) 2008 (1st Half) % Chg Actual Chg
1 Household Cleaning Products 7,134 7,520 5.4% 386.3
2 Pet Food & Treats 6,459 6,665 3.2% 206.5
3 Combination/Personal 5,655 5,899 4.3% 243.7
4 Vitamins 3,905 5,009 28.3% 1,103.8
5 Snacks 4,859 4,847 -0.2% -111.1
6 Rug/Room Deodorizer 5,146 3,711 -27.9% -1435.3
7 Hair Care 3,306 3,309 0.1% 2.5
8 CCSA 3,102 3,298 6.3% 195.3
9 Bar/Liquid Soap 2,987 3,142 5.2% 155.1.0
10 Meat/Refrigerated 2,696 2,941 9.1% 245.1

*Coupons Distributed equals the actual number of coupons distributed in FSI inserts for manufacturers’ brands.

About Marx Promotion Intelligence
Marx Promotion Intelligence, a division of TNS media intelligence, is the industry standard for tracking Free Standing Insert (FSI) coupon activity. Marx provides the finest companies in America with web-based strategic insights and tactical tools that are state of the art.

About TNS media intelligence
Established in 23 countries with more than 16,000 customers, TNS media intelligence is part of the TNS Group, ranked #2 worldwide in marketing information. TNS media intelligence monitors more than 3 million brands worldwide across a multitude of media, including TV, radio, print, Internet, cinema and outdoor. The company offers a full range of insights and analyses, including the tracking of advertising expenditures and advertising creative, as well as news and social media monitoring, and sports sponsorship evaluation.
In the U.S., TNS media intelligence is the leading provider of strategic advertising intelligence to advertising agencies, advertisers, and media properties. The company's tracking technologies collect advertising expenditure and occurrence data, as well as select creative executions, for more than 2.8 million brands across 20 media in North America. The U.S. headquarters are in New York City with sales locations in major markets throughout the United States.

About TNS
TNS is a global market insight and information group.

Its strategic goal is to be recognized as the global leader in delivering value-added information and insights that help its clients make more effective business decisions.

TNS delivers innovative thinking and excellent service across a network of 80 countries. Working in partnership with clients, TNS provides high-quality information, analysis and insight that improves understanding of consumer behavior.

TNS is the world’s leading provider of customized services, combining sector knowledge with expertise in the areas of Product Development & Innovation, Brand & Communications, Stakeholder Management, Retail & Shopper and Customer Intelligence. TNS is a major supplier of consumer panel, media intelligence and audience measurement services.

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