Summit Saver Blog

A Brief History of Coupons

Marketing genius Asa Chandler made an interesting choice when he created the first coupon in 1887. Looking for a name for the new marketing device, the Coca-Cola co-owner turned to the French language; deriving the word coupon from the French word "couper," meaning "to cut."

Chandler's crystal ball proved prophetic as -- for more than 100 years -- millions of consumers have clipped their way to savings.

With the invention of the Internet in the 1990s, thrifty Americans began trading scissors for websites that allowed them to download coupons.

Target moved coupons into the next generation when in March it became the first national chain to offer scannable phone coupons for all its stores. Major merchants are expected to follow suit with digital coupons consumers can display on their cell phones and have scanned at checkout.

As we close in on the 125th anniversary of these money-saving devices, CouponSherpa offers the following coupon-centric timeline.

Atlanta businessman Asa Candler had a brainstorm in 1887 when he created the first coupon. At the time, brainstorm referred to a brief period of insanity, but you can't question the Coca-Cola co-owner's sanity when he hit upon this invaluable marketing device.

Candler's invention transformed Coca-Cola from an insignificant tonic into a market-dominating drink. His hand-written tickets offered consumers a free glass of Coca-Cola, then priced at five cents. Between 1894 and 1913, an estimated one-in-nine Americans had received a free Coca-Cola, for a total of 8,500,000 free drinks. By 1895, Coca-Cola was being served in every state.

Other promoters began to sit up and take notice. In 1909, C.W. Post began offering coupons with a one-cent discount on Grape Nuts cereal.

The Great Depression kicked coupon usage into high gear, as struggling Americans used coupons to cut their weekly grocery bills. Even after the U.S. regained it's financial balance, consumers continued their frugal ways and coupon usage became commonplace. The movement grew by leaps and bounds when chain supermarkets began offering coupons in 1940 as a means of drawing customers away from neighborhood stores.

Merchants were overwhelmed with the administration of coupons and so a new industry was born. The Nielson Coupon Clearing House was created in 1957 to sort, count and tabulate coupons to determine how much money was owed to each retailer.

By 1965, half of all American households were clipping coupons and in 10 years that number grew to three-quarters of the poplulation.

Industries other than packaged goods began to adopt this popular marketing device in a variety of ways. Sunday newspapers printed inserts with coupons promoting everything from fast food to bank checks. The innovation of direct mail co-ops provided local businesses with an inexpensive way of distributing coupons. Grocery stores began printing coupons on the back of receipts, based on a consumer's purchases. Electronic shelf coupons also appeared to encourage point-of sale purchases.

New technologies in the 1990s led to the first Internet-delivered, printable coupons.

The popularity of the money-saving device reached astonishing levels in 1997, when 83 percent of Americans were using coupons, saving $2.9 billion by redeeming 4.8 billion coupons. The average coupon face-value that year was $0.64, quite a bump from the five-cent offer from Coca-Cola of 1887.

In 1999, 81 percent of American consumers redeemed $3.6 billion in grocery coupons each week. Those figures dropped a bit at the turn of the century as the country went through a period of prosperity, but blossomed once again as the recession took a bite out of grocery budgets.

With the introduction in 2008 of scannable mobile phone coupons, merchants could reduce overheads while cutting out the middle man.

Even the U.S. government got in on the act in 2009, distributing more than 64 million coupons worth $40 towards the purchase of digital-to-analog television converter boxes.

Today, more than 700 corporations offer coupons for discounts on products or services. Each year, coupons for consumer-packaged goods generate nearly $3 billion in transactions.

In short, Asa Candler's little marketing device has grown from being a lovely perk to an expected mainstay of world commerce.

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