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RECIPE FOR SUCCESS

What do you get when you mix equal parts of packaged food, the Internet and a meal idea?A recipe for an ideal manufacturer promotion, according to SN's 2005 Survey of Manufacturer Promotional Practices.Nearly half (46%) of consumer respondents said they went online to get a recipe, up from 22% who said the same in last year's survey.The benefits of Internet-based recipes are twofold in that they not

What do you get when you mix equal parts of packaged food, the Internet and a meal idea?

A recipe for an ideal manufacturer promotion, according to SN's 2005 Survey of Manufacturer Promotional Practices.

Nearly half (46%) of consumer respondents said they went online to get a recipe, up from 22% who said the same in last year's survey.

The benefits of Internet-based recipes are twofold in that they not only enable manufacturers to create brand awareness, but more important, create an ongoing dialogue with consumers, said Paul Thompson, partner, Henry Rak Consulting Partners, Chicago.

"Providing Internet recipes is not just about product image. They're about building relationships," Thompson said.

The best types of recipes are those that allow consumers to search by ingredient type or meal occasion, Thompson said. Kraft, Campbell and Sara Lee are among the companies that do this well, he said.

"Some of these sites even let consumers share their own recipe ideas," he added.

The health and wellness trend dominating the food retailing industry is prevalent online as well, as 20% of the consumers surveyed said they used the Internet to find health-oriented recipes.

Likewise, 52% agreed that they're buying more health-oriented groceries, and 43% said they will pay more for better-for-you products. More than one-quarter (28%) agreed that they are on the lookout for healthier food to put in their children's lunchboxes.

Nearly half (44%) agreed that they want whole-grain products more than they used to.

"Obesity has gone from problematic to epidemic," Thompson said. "This has created pressure, but also opportunity in terms of providing healthy food and beverages."

It's not enough, however, to simply offer healthy products. What's important is that better-for-you offerings also taste good, he said.

"Just because consumers are willing to pay more for healthy products doesn't mean they're willing to sacrifice taste," he said.

Along with Internet activities, the survey queried shoppers about how they

respond to a number of other manufacturer promotional practices, including couponing, sampling, sweepstakes and loyalty clubs. Following are excerpts from the results.

COUPONING

About half (48%) of the recipients said they use a few coupons a month, while 20% use one or two a week; 13% use three to seven a week.

For the most part, manufacturers are distributing coupons in the way that consumers want to get them.

More than half (54%) said they get coupons from freestanding inserts. A comparable, albeit slightly lower, amount (47%) said this is the way they prefer to get them.

Some tactics are favored more than others. For instance, while nearly two-thirds (64%) said they get coupons in the mail, less than half (47%) said they prefer to get them this way.

The majority (71%) agreed that by using coupons, they feel like they are helping their family's budget.

More than half (57%) agreed that they often purchase a brand for which they have a coupon.

Nearly half (48%) said coupons influence their decision to buy a new product.

However, responses point to growing resentment about certain coupon stipulations.

For instance, more than half (51%) agreed that they will not use a coupon if it requires them to purchase more than one product, up from 44% who said the same in last year's study.

Likewise, 50% said they don't use as many coupons as they used to because of multiple-purchase requirements.

Declining coupon redemption rates reflect this sentiment. Of about 342 billion coupons distributed last year, about 3.2 billion were redeemed, a 10% slide from 2003, according to CMS, a Winston-Salem, N.C., coupon settler.

Over the last five years, manufacturers have increased their use of multiple-purchase requirements to encourage pantry-loading, said Val Stark, vice president, Association of Coupon Professionals, Des Plaines, Ill.

"The goal is to get people to stock up on items that they use every week," said Stark, who is also national account manager, Lion Promotional Solutions, a St. Louis coupon supplier.

The growing consumer backlash against such requirements stems from the fact that consumer-shopping behaviors have changed.

Take baby boomers. While they're big coupon users, they don't want to purchase more than one of the same item because many are moving into apartments or condos with limited storage space.

Likewise, many people have shifted to fill-in, rather than stock-up supermarket trips.

"Consumers prefer not to go on big shopping trips anymore," Stark said. "Instead, they'll go to pick up food for one or two days."

While some manufacturers have backed off of the practice, others continue to use it because they rely on couponing more for advertising than redemption purposes.

Among other responses to coupon questions:

23% of respondents said they rely on coupons more.

54% look through coupons when planning their grocery list.

27% signed up for a coupon on a manufacturer's Web site.

LOYALTY CARDS

As consumers rely less on coupons, a growing number favor other types of supermarket savings. Frequent shopper cards are one such tactic. Nearly half (48%) said they don't mind when retailers track their purchases if it means they get a price discount.

Likewise, nearly half (49%) said they like it when they are automatically entered into a contest or sweepstakes through their loyalty card.

Just 6% said they will only shop at retailers that don't have shopper cards to ensure that their purchases are not tracked.

While support for cards is strong, attitudes about supermarket loyalty clubs are a different story.

Just 8% said they shop repeatedly at the same supermarket because it has a baby, pet, wine or other "club."

One-third (33%) said they don't think such clubs offer any value.

This could be a result of the fact that a sizable number of consumers don't believe that loyalty clubs save them money, said Glenn Hausfater, managing partner, Partners in Loyalty Marketing, Chicago, a marketing consulting firm.

Many people feel that supermarkets simply raise prices, and then give them a discount with the club card, Hausfater said.

"They think that the price is essentially the same as it would have been without the card had the prices not been raised," he said.

Even so, Hausfater said he is surprised that just 8% of respondents said they repeatedly shop at the same supermarket because of a club.

"This reflects the fact that it's a competitive environment, and even with clubs and discounts, supermarkets are not keeping pace in the marketplace," he said.

To change that, Hausfater said supermarkets -- and their manufacturer partners -- should sponsor clubs that offer more than just discounts.

"They should provide perks and insider information," he said.

SAMPLING

Sampling is largely achieving what marketers want it to do, according to results.

About half of the respondents (47%) said they try three-quarters of the product samples they receive. More than one-third (35%) said they try every sample they get. One-quarter said they often purchase a product after trying the sample.

Nearly three-quarters (72%) said they would consider switching brands if they liked a free sample, and nearly half (47%) said they often buy a product after receiving a sample.

The way in which manufacturers distribute samples closely aligns with the way that consumers want to get them. More than half (54%) said they currently get samples in the mail.

More than two-thirds (67%) said they prefer to get them this way.

Results show that consumers would like to get more samples at the store than through other distribution sources.

While nearly one-third (32%) said they get samples in this manner, 60% said they prefer to get them this way.

Among other findings:

- Nearly three-quarters (72%) said they often become aware of new or improved products through samples and coupons.

- More than one-third (38%) signed up for a free sample on a manufacturer's Web site.

SAVING MONEY

While one-quarter (26%) said they prefer national brands and are willing to pay for them, nearly half (48%) said they buy store-brand products more often.

Similarly, more than half (56%) said they're buying more discounted items.

Nearly two-thirds (61%) said price is more important than brand names when it comes to grocery shopping.

CONVENIENCE PRODUCTS

Forty percent agreed that they are on the lookout for food that simplifies their lives, such as easy-open lids and portable packages.

"Manufactures are clearly trying to make their products fit in with consumer lifestyles by providing packaging that's easy to use," Thompson said.

He cited Campbell's Soup at Hand, a microwavable, sippable soup, as an example.

This doesn't mean that price isn't an issue, however. While people want more convenience products, less than one-quarter (20%) said they will pay more for them.