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Grocery stores offset rising food costs with extra coupon savings

SALT LAKE CITY — Grocery coupons are enjoying a surge in popularity, a fact readily visible when we visited stores for this newspaper's monthly fantasy shopping trip to track the rise and fall of prices on certain commonly purchased items on the Wasatch Front.

The total at the register was up slightly, driven by increases for gasoline, bread, frozen corn, eggs and ice cream, among others. Price drops on milk, burger, orange juice, Cheerios and diapers, among others, were a bit more modest.

Since this particular "grocery cart" of items was first tracked in September 2009, overall prices have increased more than 4 percent.

The cart includes a dozen common items, like laundry soap and cereal, a take-out pepperoni pizza, 10 gallons of gasoline and a trip to the movies with treats. Readers can see where in the price range their store falls on popular items.

For the first time, the decrease in prices did not reflect items temporarily on sale. But a couple of the stores have done price reductions to a lower everyday price that makes the range between best price and most expensive truly startling in some instances. The identical loaf of bread, for instance, ranges from $1.98 to $3.29, without including any sales prices. The least expensive Steamfresh corn is less than half the price of the costliest.

Visit any grocery these days, and it's easy to spot the popularity of money-saving coupons, an impression confirmed by industry experts. Coupons are abundant on store shelves, handed out freely with cash-register receipts and every third customer on Monday was handing them over with their payments.

A Nielsen Co. report says the Great Recession has brought new popularity to money-saving coupons, which include newspaper coupons, those downloaded from the Internet, cash-register print-outs and savings loaded directly on frequent shopper cards.

Nielsen found that 89 percent of coupons are distributed by newspapers and more than half of those that are redeemed are clipped from papers. But Internet redemption growth "has skyrocketed," as well.

Before the economy soured, coupons were "on their way to extinction," according to a Nielsen Wire report, leveling off by the end of 2008 at $2.6 billion per year. The 1999 heyday was $4.6 billion.

Inmar, the top promotion transaction settlement provider, said annual coupon use is on the rise for the first time since 1992, with $3.3 billion redeemed last year. That boom started with the recession and is ongoing. To counter the cost of increased redemption rates, the face values in 2009 declined by an average of a penny and expiration periods were shortened 10 percent, according to Inmar.

The heaviest users, by the way, were not cash-strapped families, although they use them, too. More-affluent families were the primary drivers of coupon growth in 2009. The Nielsen Wire report cited Scarborough Research's finding that better-educated and higher-income households read and use the newspaper more than others. Other particularly coupon-savvy groups are larger households, younger female households and seniors 65 and older.