There has been a significant decline in the use of ‘Instant Win’, ‘Collector Packs’, ‘Free Mail Ins’ and ‘Self Liquidating Promotions’ promotional mechanics since 2005 while in contrast the use of coupon and cash back promotions has risen dramatically making them the most frequently used on–pack promotional mechanics.
That is the key finding of the latest annual Fotorama Promotions Research carried out by the leading fixed fee and promotional risk management company.
Instant Win promotions have dropped from 44 per cent of on-pack promotions in 2005 down to 18 per cent during 2011. The decline accelerated in 2008 onwards as brands and agencies opted for a more coupon based strategy in line with consumer and economic trends.
Coupon promotions, which accounted for just 20 per cent of on-pack offers in the first survey in 2005, have continued to rise steadily in popularity with marketers since with a marked increase in 2008, gaining further momentum and reaching 43 per cent of the share in 2011.
Cash back promotions were propelled forward in the promotions market by their increased use during the 2010 FIFA World Cup and have continued to rise in popularity since. During 2011, 30 per cent of on pack offers were based on this mechanic.
Collector Packs, Free Mail Ins and Self Liquidating Promotions have always been used less than their counterparts. Their presence in the market has steadily declined from 15 per cent in 2005 to just 9 per cent in 2011.
Philip Penlington, Director of Fotorama, commented: “It is interesting to see the trends that we observe around us quantified by this analysis. In 2011 trends that we have seen since 2008 continued since when the pressure on household spending has changed attitudes to coupon and cash back promotions. We have become and continue to be a nation of coupon cutters and cashers and promoters clearly believe that this is the primary way to boost their brands while the economy stays in the doldrums.”