A ‘manufacturer coupon’ is a particular breed of consumer discount that has some very real and well-established benefits not just for consumers, but also for CPG marketers and FMCG retailers. Customers can use the coupon at any retailer of their choice and benefit from significant savings. CPG brands are able to motivate a large number of retailers to restock additional cases of their products in advance of the surge in demand while also engaging and rewarding their target consumers independently of any retailer’s influence and agenda. And retailers benefit from the increased traffic and product sales coupons drive, which are often paired with ‘trade discounts’ that reduce the cost of goods to the retailer. The scale of this popular marketing tactic is considerable – according to the 2018 Inmar Promotions Industry Analysis, 267 billion coupons were issued and distributed in the U.S. that year, and 1.74 billion of those were redeemed by customers.

These benefits are made possible by a market structure and value chain of agreements and services that have existed for decades, and have thus instilled trust and predictability among everyone involved – consumers, retailers, and manufacturers.Coupons are born at marketing headquarters of major CPG brands and play a variety of roles in achieving the brand manager’s business objectives. These include supporting new product introductions, generating new customer trial, driving brand loyalty through pantry loading, and recovering lapsed buyers.
As CPG marketers design their promotional campaigns, they determine the appropriate face value of the coupon, the duration of its validity, the product purchase requirements, and the scope of the campaign (national vs. regional vs. retailer-specific). They generate the creative for the coupon campaign, which includes both the equity message (where applicable) and the coupon artwork and determine the method of distribution. They adapt the creative for different coupon formats, e.g. paper FSI, Catalina coupon, digital coupon, instant redeemable coupon (IRC), etc. (see below).
To get a coupon ready for marketplace consumption, the brand team then obtains from their clearing house a valid GS-1 offer code, which has all the attributes necessary for the coupon to be machine-readable by the point-of-sale (POS) system at checkout. These include manufacturer code, brand family and face value. Then, they book a ‘drop date’ and media rates with their distribution providers, and if the campaign is run on a ‘category exclusivity’ basis, they secure all the relevant categories, so competitors’ coupons in the same product category don’t get published alongside this campaign. In the end, the CPG team sends the print artwork or digital assets, including the GS-1 databar that has been set up correctly, to the coupon distribution vendor(s), who will publish the coupons in accordance with the agreements that were made. 2. Distribution
Once the coupon is designed, assigned a GS-1 code, and setup in the distribution vendors’ systems, it’s time to get it into the hands of as many target consumers as possible. One big decision is “paper vs. digital” – or how much of the coupon’s circulation to allocate to analog (or paper) modes of distribution and how much to distribute electronically via digital channels. Another decision is what types of coupons to activate as part of the campaign.