FRUGAL GOES SOCIAL
Abisola Akinkuowo is always looking for a good deal, and wants to spread that savings gospel to her growing social media audiences. Akinkuowo, who lives in Prince George’s County, started out with a social media focus on the high costs of higher education.
Now, she’s expanded to the high costs of everything else.
Her @CouponingwithAuntAbby platform focuses on helping followers find discounts on food and other items via coupons, and finding sales has quickly bolstered Akinkuowo’s footprint to more than 20,000 followers.
“It has grown exponentially, especially on TikTok, as people have more of an interest in saving money,” she said.
Akinkuowo is part of a new generation and wave of social media influencers on Instagram, YouTube, Facebook and other platforms offering saving tips to consumers facing rising prices.
“The most popular topic is using coupons during shopping trips that would bring the total from $90 to $3, for example,” she said. “Due to inflation, more people are cautious of the flow of their cash. Families are more concerned with their everyday expenses and their large one-time expenses. At grocery stores, people are thinking twice about what they add to their shopping cart, and examining what things are really worth.”
Grocery prices were up 8.6% in February, compared to a year ago, and energy prices, including gasoline and diesel fuel, are up 38%, according to the Consumer Price Index. And that was before the inflationary and supply chain impacts of Russia’s war in Ukraine, and resulting U.S. bans on oil, farm and other imports from Moscow.
Overall, U.S. inflation is at its highest levels in 40 years, according to the U.S. Bureau of Labor Statistics. New age for coupons
New couponing apps and online deals and customer rewards programs are also emerging on various social media and technology platforms as consumers struggle with higher prices.
Rakuten, which was previously Ebates, has more than 15 million members in its program, which offers cash-back rewards for purchases made with partners such as Macy’s, Kohl’s, Nike, PetSmart and Old Navy.
Katie Stevens, a spokesperson for the company, said the 2021 holiday season saw an 11% year-overyear growth in revenue for Rakuten. “Consumers are placing a high value on rewards, and it’s going to be a key driver of spending over the coming months,” she said.
There have been more than 40 million downloads of the Ibotta app, according to Rich Donahue, chief marketing officer for discount reward and cash-back platform.
Highest inflation in 40 years propels a new wave of coupon clippers
Denver-based Ibotta partners with Walmart, Amazon, Target, Albertsons and other retailers on rewards and discounts. Donahue said inflation is driving some of the company’s growth efforts.
“Inflation is causing everyone to try to stretch their dollars as far as they can. Shopping with Ibotta means every time you make a purchase instore, online or for delivery, you have an opportunity to earn cash back rewards and stretch your budget,” he said.
Part of those growth efforts include deepening Ibotta’s partnership with Walmart, and increased use of branded online platforms, recipe hubs and social media networks. PayPal acquired online couponing firm Honey for $4 billion in 2019. The firm’s app and browser extension will apply coupons automatically to relevant purchases. Honey has more than 17 million members, while its parent PayPal has 426 million active accounts to leverage.
There are historical parallels to some of the new focus on frugality. Individuals who grew up during the Great Depression often have a focus on saving money. Anne Alexander, an economist with the University of Wyoming, said how long high inflation lasts will drive its last impacts. She knows retailers and wholesalers are already bracing for continued higher prices and inflationary and supply chain impacts.
“They’ve seen this play before, and they know how it ends,” Alexander said.
Promoting their own
A number of big-box and grocery chains, along with Amazon.com, are also increasing their efforts to promote deals and sales to customers via apps. Amazon has deal of the day promotions, while Target offers online coupons and discounts via its Circle app.
Some of those pushes also come as supermarket and big-box retailers post monster profits during the pandemic, even with wholesale prices up significantly.
For example, Publix supermarkets, which operates 1,297 grocery stores in Florida and Southern states, posted a $4.4 billion profit in 2021, up 11% from 2020, when its net earnings were $4 billion, and up 47% from pre-pandemic 2019 earnings of $3 billion. Publix expenses are up 24% from pre-pandemic levels. Higher prices have also sent some consumers to shop more at discount chains such as Walmart and Target or German-based Aldi, which operates 2,100 stores in the U.S. and will add another 150 this year. Similar to Walmart and warehouse chains, Aldi is gearing its branding toward being a less-expensive grocery alternative. “Customers are turning to Aldi more than ever before because they know we provide a grocery shopping experience that offers incredible value with premium groceries at simply unbeatable price,” a spokesperson said.