According to the May 16 article on Bloomberg.com, "Macy's Loses Sales as It Weans Shoppers From Coupons", by Cotton Timberlake, coupons were born in 1894 when Asa Candler, the druggist who bought the Coca-Cola formula, gave out handwritten tickets for a free soda, according to New York-based Promotion Marketing Association's Coupon Council. And in 1895, C.W. Post distributed coupons toward Grape Nuts cereal. In 2005, 46 percent of U.S. retailers offered them. Today, 80 percent of Americans use coupons, saving $3 billion a year, the Coupon Council says. Federated's coupons are typically issued via the mail and in newspapers, offering 15 percent off.
More from Bloomberg.com:
"Federated Department Stores Inc. is trying to break its shoppers' addiction to clipping coupons in order to boost earnings. In the process, it's losing customers once loyal to the Marshall Field's, Filene's and Hecht's stores it bought in 2005."
"Federated's aim is to transform shopping habits by getting consumers hooked on consistent prices instead. The second-largest department-store chain, which plans to change its name to Macy's Inc. in June, may fail as companies such as Dillard's Inc. have had little success after shoppers resisted such changes."
"Federated has cut the number of days coupons can be used by almost a sixth at the May locations, which previously offered coupons about 256 days a year. ... Without coupons, former May customers may shop instead at J.C. Penney Co. and Kohl's Corp., where the discounts remain plentiful."
Customers say if it ain't broke, don't fix it. In Chicago, Marshall Field's has become Macy's. Macy's introduced its new Everyday Value program, featuring products at every day low prices. Product with EDLP signing just isn't as sexy to customers as letting them choose for themselves what's on sale.
Stephen Hoch, marketing professor at the University of Pennsylvania's Wharton School in Philadelphia, wonders if Macy's has the willpower and stamina to withstand the pain of eliminating coupons. He said, "We're all rats,. If you don't get a food pellet, after a few more times you will say, `Screw it, I'm going somewhere else.'''
We think he hit it that one right on the head.
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