VALENCIA, Calif. -- Register Tape International's third-party couponing program will become available in all 2,400 Kmart stores nationwide beginning in February 1995.
The decision to expand it to the entire Kmart chain, headquartered in Troy, Mich., was based on a successful trial last summer of RTI's Kmart Direct program, said RTI vice president Alan Spiegel.
RTI, based here, delivers four-color manufacturer coupons that are preprinted on the reverse side of retail register tapes. It began the Kmart Direct pilot at 350 stores in August 1994. Six brand marketers participated with four-week coupon promotions, Spiegel said.
Kmart scanner data from the test stores were analyzed by research agency Promotion Decisions Inc., Cincinnati. Promoted items sustained an 18% average bump in sales volume over a 13-week period following the start of the program, Spiegel said.
Brands participating in the pilot were Lipton Tea Bags, Leaf Milk Duds candy, Jergens Lotion and Mild Soap, and S.C. Johnson's Shout detergent and Armstrong floor cleaner. Coupon values ranged between 30 and 55 cents. When the Kmart program goes chainwide early next year, Spiegel said he expects several of the same brands will participate again, but he would not reveal which ones.
He said brand marketers use the register tape program rather than purchase-triggered electronic coupons because the tapes offer mass distribution at a low cost. A coupon distributed via Kmart Direct reaches 85% to 90% of a store's customers, Spiegel estimated.
He estimated that redemption rates reach 1.7% to 1.8% compared with the average 2% to 3% redemption from a freestanding insert but he noted that his program protects manufacturers against misredemption. "If you were to look at valid redemption, I believe we're actually exceeding what an FSI does," he said.
RTI is currently available in more than 7,000 stores nationwide through mass, drug and grocery channels.
