[Donuts]

news article today, study was by pricerunner (owned by valueclick, who also own cj)

Higher Incomes Use Online Coupons More Than Lower Incomes
http://biz.yahoo.com/bw/070612/20070612005072.html

I thought this was an interesting story. My casual observations in talking to people seem to conclude the same thing.

And all who were surveyed have internet access, so this isn't about the have's versus the have not's.

Not sure why higher incomes are more drawn to deal shopping, logic tells me they'd be slightly less price sensitive than lower income counterparts. I think this defies pricing logic because it's not really about saving dollars, it's about the feeling you get when you got a "deal". Perhaps higher incomes have a little more time to shop or something. Or they're used to negotiating more often or something.

Putting my finger on the "why" is a tad elusive. I bet Coley has some good insights. Look forward to hearing that. Anyone else want to throw their ideas in, I think this topic is somewhat fascinating statistically - would love to hear every idea, no matter how whacky, twisted or obvious (to others besides me).

[KIMarketing]

I remember when I was little at the grocery store and the richest man in town went out to his car during checkout to get his coupons he had forgotten. I asked my mom why when he had so much money.

She replied thats why he has so much money - he knows how to save it and spends it wisely. Ever since then I've used coupons.

[rematt]

Originally Posted by KIMarketing

I remember when I was little at the grocery store and the richest man in town went out to his car during checkout to get his coupons he had forgotten. I asked my mom why when he had so much money.

She replied thats why he has so much money - he knows how to save it and spends it wisely. Ever since then I've used coupons.

Love it!

[Donuts]

Read the book "The Millionaire Next Door" and you'll discover that being a millionaire is most often determined by your ratio of income/spending and rarely corresponds to to income alone. It's obvious I know, cuz to be a millionaire is to have / keep money, but our eyes have trained us to "look" for signs of wealth. Gotta look deeper.

From the article:
~~~~~~~~~~~~~~~~~~~~~
58% of the survey respondents who had household incomes of less than $35,000 a year said they had used an online coupon at least once in the past six months, while 74% of those with household incomes between $35,000 and $74,000 said they had used an online coupon at least once in the past six months. Meanwhile, 84% of those with annual household incomes of at least $75,000 said they had used online coupons at least once in the past six months.

The $75,000 and above salary group also reported more frequency in using online coupons in the last six months, with 48% of them saying they had used online coupons four or more times in the last six months. Only 23% of the survey respondents who had indicated their annual salary was less than $35,000 said they had used online coupons four or more times in the last six months.
~~~~~~~~~~~~~~~~~~~~~

To me, these groupings are starkly different from one another. I'll be thinking about these numbers for weeks... I think they're interesting in so many ways!

[MichaelColey]

Yep, Kim and Donuts have the right answer. It's not so much that the rich use coupons, but that those who use coupons (and have other frugal habits) are more likely to get rich.

I echo Donut's sentiments about "The Millionaire Next Door". It's something I think everyone would benefit from reading.

[knight01]

Originally Posted by Donuts

From the article:
~~~~~~~~~~~~~~~~~~~~~
58% of the survey respondents who had household incomes of less than $35,000 a year said they had used an online coupon at least once in the past six months, while 74% of those with household incomes between $35,000 and $74,000 said they had used an online coupon at least once in the past six months. Meanwhile, 84% of those with annual household incomes of at least $75,000 said they had used online coupons at least once in the past six months.

Haven't read the article yet, but first blush is does this survey include only those that have made a purchase in the last 6 months?

Perhaps lower incomes don't purchase online as much as an overall group?

Does the survey actually state the types of purchases? Again, lower household incomes buying lower priced items which perhaps do not have coupons or as many coupons available?


Ok, now I'm off to actually read what I'm talking about.

[Rexanne]

Originally Posted by KIMarketing

thats why he has so much money - he knows how to save it and spends it wisely.

Yep - I've seen it first hand in my family. The "wealthy" ones spend like they're about to become homeless and the struggling ones are spending it like they have it. Unfortunately, I fall into the latter category. LOL

[123ibuy]

For years I've thought it was likely true that higher income people use more coupons. I think that is so for a variety of reasons including:

+ Higher income buyers make more purchases and so have more chances to use coupons.
+ They tend to have lifelong frugal habits and that's why they have more money now
+ Those who have money tend to desire to save it and coupons help you keep more of it
+ Coupons tend to be most available for highly-competitive non-essentials (and higher-incomes consume more of these goods and services)

Years ago I worked for a man who fell into the higher income categories (not rich but upper middle class). He was frugal, looked for good deals, and bought quality things that would prove to be long-lasting investments. He frequently reminded me that he had "paid his dues" in his younger years and could enjoy these benefits now.

[Rhia7]

There was a product I have wanted all my life (at least since I was 13 years old) and the online store I was ordering from promised a coupon code if I answered some information.

I answered the information but was so excited when filling out the online order that I forgot the coupon code

Oh well -- I wonder how many people have shared that experience?

Going back to Donuts' first post: yes, I would think that the educated consumer might like coupon codes [but I had too many tabs open and was too excited to remember the code given me] -- wish me better luck next time

[Donuts]

+ Higher income buyers make more purchases and so have more chances to use coupons.

Look at the data again. The non-linearity for the $75K+ / used 4+ coupons tells me this isn't just about frequency of opportunity.

+ They tend to have lifelong frugal habits and that's why they have more money now

Wealthy people are frugal, but high earners are not - this study compared income groups, not how much wealth they've accumulated - big difference.

Most high earners are not good savers. The Millionaire Next Door has extensive research that proves that point. High earners are our worst spendthrifts, which is why this survey's results fascinates me. Something besides frugality is driving high income earners to be more frequent couponers.

Just my opinion here, I'm "discussing" these points more than I'm "arguing" them really.

+ Those who have money tend to desire to save it and coupons help you keep more of it

I hear low income earners talking about their desire to save money a lot more often than higher income earners that I know. I honestly think there's a disconnect between money saved (as in budgeting your life, your checkbook balance) and the thrill of a deal or something.

The money most people save with their coupon activities will make no difference at all in their lifestyle.

+ Coupons tend to be most available for highly-competitive non-essentials (and higher-incomes consume more of these goods and services)

Hmmm, now there's a very interesting theory and thought. I'm going to mull on that one for a while. If true, it might change my merchant selection criteria I use for my coupon site. Do you know where I might find some data to show that they are indeed more commonly available for highly-competitive non-essentials? If this is a gut feel you've developed (any of you), could you post an example of two for me, product area, example merchants, etc.

[redtagdeals]

+ Higher income buyers make more purchases and so have more chances to use coupons.

The above factor skewed the results of the survey. The study assumed that lower and higher income groups made same number of purchases online. Better study could have been measuring coupon usage as a percent of number of sales.

Nevertheless, it is an interesting study. Target high income groupers for long term coupon'ing success. I also think high income groupers are more likely to use a coupon online than offline!.

[Donuts]

anyone else notice that coupons seem to fire off in the evenings more than at other times?

i do lots of non-coupon related marketing, much more than coupon related, so i know the usual intraday dips - i'm not talking about that. over and above those patterns, my coupon site rocks in the evening hours and is nearly a dead fish during lunch time prime shopping hours for instance.

are couponers too busy at work to be frugal, even with their personal purchases?

[MichaelColey]

Might just be yours. My site is much more active during the day, Monday through Friday. People shop from work.

[redtagdeals]

I see a small uptick during west coast (California) evening hours!.

[123ibuy]

Originally Posted by Donuts

+ Coupons tend to be most available for highly-competitive non-essentials (and higher-incomes consume more of these goods and services)

Hmmm, now there's a very interesting theory and thought. I'm going to mull on that one for a while. If true, it might change my merchant selection criteria I use for my coupon site. Do you know where I might find some data to show that they are indeed more commonly available for highly-competitive non-essentials? If this is a gut feel you've developed (any of you), could you post an example of two for me, product area, example merchants, etc.

I don't have data at my fingertips but think of the Economics 101 supply and demand curve explanation. If something has inelastic demand (like essential foods), a change in price does not change the demand for the item since we all have to eat. However, something elastic (and non-essential like luxury handbags) will experience fluctuating demand based on pricing changes. Lower the price (and that's what a coupon does) increases the demand. Conversely, raise the price and lower the demand.

As for online shoppers, I see most of my site's activity during office hours with a small uptick in the evening (PST time zone -- other time zones probably get lumped into the "office hours" range due to a 3 hour difference from East to West).

You are right that income and savings and not necessarily related. I knew better but lumped those two together which was sloppy on my part.

[Alan Hamilton]

Donuts offers...

"Wealthy people are frugal, but high earners are not - this study compared income groups, not how much wealth they've accumulated - big difference.

Most high earners are not good savers. The Millionaire Next Door has extensive research that proves that point. High earners are our worst spendthrifts, which is why this survey's results fascinates me. Something besides frugality is driving high income earners to be more frequent couponers."

Excellent points here! High earners are often times not wealthy in terms of assets and liabilities. Wealth is created through a combination of earnings, budgeting, investment, reinvestment, asset acquisition, spendthrift habits etc. (aka: self discipline)
Could be that a growing number of high earners are leveraged deeply enough that coupon savings are important to them. Interesting subject.

[redtagdeals]

Points to be taken from the study:

- High Income Earners shop online more

- High Income Earners use online coupons more


Other comparisons to lower income earners are skewed as the number of online purchases made by lower income groups vs. high income groups was not taken into consideration and normalized by the study

[JudiMoore]

I think that several of the ideas presented here are worth batting around some more, but I would like to hear what you think about this one, too:

Higher income levels might also indicate enough shopping know-how to answer the survey in a way that will produce more coupons down the road? I know that I would be likely to answer that I used them often because 1) I always wish I had a coupon and 2) I want lots and lots of coupons to browse.

I really think the "more coupons available for non-essentials" is something we should figure out. I think it's probably true, since milk and bread only have coupons when the company is using those necessities to push cookies or ice cream or high-priced cereal as an add-on. (Just one example)

[Mack]

Originally Posted by jmoore61103

Higher income levels might also indicate enough shopping know-how to answer the survey in a way that will produce more coupons down the road?

I quit taking surveys after taking the ones that were posted here on ABW. According to them I'm a Redneck Computer Geek with a New York Accent.

[Trust]

Originally Posted by MichaelColey

Might just be yours. My site is much more active during the day, Monday through Friday. People shop from work.

Same here. When I first started I thought it would be weekends but after getting into it more and reading, a lot of people shop at work during the weekdays. On the weekend it's more family time not so much computer. And that's in general. Mon - Fri, busy. Weekends slower.

[Donuts]

Yep, day patterns (weekday versus weekend) I see, it's the intraday patterns I'm talking about.

On weekdays, my evenings are far, far stronger than my lunches, on my coupon site. In other things I do, I see power at lunch.

But I hear others hear saying lunch is good for them, so I think Coley's right - it's just my site. The mix of merchants, promotion methods, etc, whatever - as it matures, I'm sure it'll change. So good, I may have some stronger lunches to look forward to in my future.

Relatively speaking, the evenings are much, much stronger than I thought they would be.

Curious if any merchants will chime in... as coupon affiliates, we can't see the whole picture, I think. I do other non-coupon stuff, can't tell from that angle either. Merchants, got any "percentage of buyers using coupons versus hour of day" data?

Not sure how i'd use the data, more just curiousity itching me.

[Trust]

As far as intraday and this is from about 6 years of stats on a coupon/shopping site, for me the 8PM- 9PM is the busiest of the after work hours. I think it's because people get home from work eat, do whatever and then they get online for a little bit before they go to bed.

[Donuts]

Yep, me too - and my 8-9PM is about 4-5x the size of my best lunchtime hour.

[jackson992]

For some reason I usually see most of my sales show up at night.

Weekends are usually disaster for me lol, especially the dreaded Saturday.

[redtagdeals]

Yep, me too - and my 8-9PM is about 4-5x the size of my best lunchtime hour.

4-5x?. Something is odd with that. Perhaps it is a mix of your merchants or promotional methods. Alternately you can look forward to more power lunch hours in the future