All Things Food & Drink    

Why Grocery Coupons Work

Grocery coupons can really save money on groceries when shopping at the supermarket. But why would that supermarket discount the price of a product that may already be selling, to attract customers to purchase it at a lower cost?

Because they are relying on those same consumers to buy other items also in store at a profit!

We all know that supermarkets discount the price of certain grocery items from time to time to attract customers to their stores, and for conveniences sake you may often purchase all of the items on your grocery shopping list at that one store. But what you may not know is that the grocery store isn’t necessarily the one ‘paying’ the price for having certain products on special… it is the manufacturer.

Not only does the manufacturer bear the bulk of the loss when selling products at a discount (some of this is shared by the supermarket chain) but the manufacturer often pays for this product to appear in the coupons mailer or flyer that gets sent to your mailbox each week, and will even pay for the product to be prominently displayed at the end of a grocery aisle in store as well. This kind of promotion can run into the thousands of dollars.

Why do they spend this money? Because at certain times during the year what you the consumer spends on brand names is tracked across the till every time a purchase is made, and this spending determines what space a product gets allocated on the shelf in store.

Maybe the best example of a manufacturer who knows this principle well is Coca Cola. Walk into almost any supermarket and you will see almost an entire aisle dedicated to Coca Cola branded soft drinks. Is this because soft drinks are the largest selling item in the supermarket? Sometimes, yes.

You see the cycle that spending is tracked is closely followed by Coca Cola, and they know that when the next cycle of tracking begins, if they provide grocery coupons for customers to purchase Coke at a substantial discount, the tracking will show that Coke branded soft drinks sell more than any other brand in store. When it comes time to pack the supermarket shelves, they are given a higher priority over other brands, because the grocery store can see that they would not move as much product of a competing brand.

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