Section 1: FSI Industry Overview

Fast Facts - Summary
Activity in the first half of 2008 dropped slightly compared to H1 2007 with a 3.4% decline in Coupons Dropped and small drop of 1.1% in Pages Distributed. Average Coupon value climbed to an all time high of $1.34, a 7.5% increase verses H1 2007. Fuse lengths increased for the first time since 2005, increasing 1.7% to 10.2 weeks.

Total Page Allocations
Total page allocation across major sector of FSI continues to be dominated by CPG. CPG controls a 70.1% share of all pages distributed. This amounts to a 0.5% increase vs. the same period H1 2007. Direct Response H1 2008 decreased for the second year in a row, dropping 6.7%. Meanwhile, Franchise remained flat, up 1.0% verses H1 2007.

Section 2: Consumer Packaged Goods FSI Coupon Trends

Total (Non-Food vs. Food)

Distribution
Distribution for Total Packaged Goods decreased 3.4% in the first half of 2008. The decrease was driven by Food with a 11.4% decrease. Non-Food increased slightly, up 2.5%.

Face Value
Face Values grew 7.5%, or $0.10, in the first half of 2008 for Total Packaged Goods verses the same period a year ago. Both Food and Non-Food contributed to the increase with Non-Food increasing $0.09 or 5.4% and Food increasing $0.05 or 5.6%.

Expiration Length (Fuse)
Fuse began to level out after years of slight decline by increasing to 10.2 weeks for Total Packaged Goods, an increase of 1.7%. The major driver of this change comes from Non-Food which increased 3.2% to 9.8 weeks.

Major Segments

Distribution
The majority of major CPG segments saw declines in the first half of 2008 verses the same period a year ago. Frozen Products saw the biggest percent decrease, dropping -28.0% to 4.9MM and Dry Grocery had the largest actual decrease, dropping-9.1% to 31.6MM. Meanwhile, Health Care had the largest increase (both percent and actual) of 9.4% bringing the total distribution to 24.6MM.

Face Value
Average face values dropped in most major segments except Dry Grocery and Health Care. Health Care saw the largest increase in Face Values, up 17.7% to $1.96 which is also the highest Value among all Areas.Shelf Stable Beverages reported the largest percentage decline in Face Values, down 20.7% to $0.79.

Expiration Length (Fuse)
Fuse lengths increased in most segments, except Personal Care, Refrigerated Foods and Dry Grocery. Segments with the largest fuse increases were Other Packaged Goods, up 1.6 weeks, Shelf Stable Beverages, up 1.3 weeks and Frozen Products, up 0.7 weeks.

Leading CPG Categories

Distribution
Top 25 growth categories for coupons dropped (based on at least 500MM coupons) in the first half of 2008 included, Pharmaceuticals, +127.7%, Yogurt, +59.6%, Laxatives, +46.9% and Breakfast Food, +43.2%. Vitamins posted the largest absolute increase, +1.1 billion coupons dropped verses the same period a year ago.

Face Value
Top 25 categories posting the largest increases in coupon face values were led by Sugar, +104.5% or +$0.46, Furniture Polish, +67.0% or +$0.63 and Candy, +63.8% or +$0.58. Ear/Eye Care posted the largest absolute increase of +$0.90.