Seeing is Not Believing Part 12

Most people use coupons when they shop. They appear to save us money, especially since many stores double them. But in reality, they are simply another form of advertising and generate additional profits for both the manufacturers and the stores.

There are two common types of sales coupons: those from the manufacturers on specific products and those from stores. Both serve the same purposes – to get you in so you will shop, and to get you to buy a product you may not otherwise purchase. In some cases the items are new, and providing a discount coupon is a major sales technique to win your loyalty to the product. Manufacturers believe, and they are frequently correct, that once an item is tried many shoppers come back to it.

Over the years, stores have tried to attract customer loyalty by placing their own coupons in advertisements – you only get the discount on the product at that specific store. Of couse the manufacturer gains as well, and has probably reduced the wholesale price to that store during the sales period. One advantage to the store is that they do not double their own coupons. A 75 cent off manufacturer’s coupon may cost the store $1.50 if they double, but their own coupon for the same amount would cost them half that amount.

Stores usually limit the doubling to coupons under a dollar. Thus a 75-cent coupon is worth $1.50 to the consumer, but a $1.00 is only worth face value. This explains why manufacturers have so many $1 coupons. BUT – to use them you need to buy multiples of the product. Thus you see $1 off two or three items, which forces you to buy more than you might need or reasonably use. You may be tempted to pass the item by, but the name remains in your mind through this subtle advertising technique.

Recently one cat food manufacturer has been offering a dollar off if you purchase 24 cans at one time – thus less than three cents per item – and each can sells for over 60 cents. Thus to get your dollar back you have to spend at least $14.

So how can a consumer win at this game? Selectively use coupons only for items you would otherwise purchase. I happen to use the brand of cat food mentioned above, and wait for it to go on sale, usually around once a month. I currently have around 60 discount coupons for items I generally use anyway and compare them to what is on sale, using a coupon only if it is to my advantage to do so.

One of my favorite grocery stores offers coupons that seem to provide significant discounts. They may be for $1 off any frozen food item in the store or 25 cents for a loaf of bread. The catch is that you have to spend $15 (not including the coupon items) to qualify. Since I make a shopping list and rarely vary from it, there are times I pass on such items.

One way you can take advantage of such promotions is to have a separate list of items you know you’ll need sometime within the next few weeks that do not normally go on sale: garbage or storage bags, detergent, spices, tea… If you need a few dollars more to make the spending requirement, purchase one or more of these items.

Used properly, couponing can save you several hundred dollars a year as well as give you the opportunity to try items you might not normally purchase. Just remember that neither the manufacturer nor the store is losing money on them, and they are gaining a customer.