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Supermarket shoppers usually know exactly what they want. They speed up and down aisles, filling their carts with the same brands they've been buying for years: Kellogg's corn flakes and Minute Maid orange juice for the kids' breakfast, Pepsi for dad, Friskies for kitty.

So how do big manufacturers convince loyal consumers to try a different brand? TV commercials and magazine ads can play a big role in reshaping public opinion, but there's another way.

Catalina Marketing Corp. contends that the most efficient way to change consumer brand preferences is with a new variation of an old standby: discount coupons. St. Petersburg-based Catalina markets an electronic supermarket system that prints and distributes coupons at the point of sale.

Manufacturers use the system to issue cents-off coupons to shoppers when they purchase a competitor's product. Catalina's system works in tandem with the price-scanning equipment already installed in many supermarkets; when a grocery clerk scans the universal product code (UPC) printed on a container of Minute Maid orange juice, for example, a Tropicana coupon can be issued on the spot.

Catalina says 9% of its coupons are redeemed by shoppers, compared to less than 1% of magazine coupons, 1.8% of newspaper coupons and 3.8% of direct-mail coupons.

The company got its start in California in 1983 when five friends on a sailing trip to Catalina Island came up with the idea for electronic coupons. Catalina eventually attracted $12 million in venture capital, culminating in the company's 1992 initial public offering. Of the five original founders, only Catalina President and CEO George W. Off is still an employee. Two others, Michael O'Brien and Brian Yeatman, work as company consultants.

Today more than 130 consumer goods manufacturers, including Campbell Soup, Kraft Foods, Nestle Food and RJR Nabisco, are Catalina customers. Catalina makes money by charging them fees based on the number of coupons distributed on their behalf.

Retailers buy into Catalina's program because, after paying a small installation charge, they get a distribution fee for each coupon printed. The number of participating stores in the U.S. now tops 9,000, which draw an estimated 120 million shoppers each week. Catalina's retail customers include Winn-Dixie, Safeway, American Stores and Kroger.

Outside the U.S., Catalina's system reaches about ten million shoppers each week in European and Mexican supermarkets. In 1992, Catalina began its international expansion in the U. K.; it now operates in Mexico, France and Belgium as well. Operations in the U.K., where Catalina's coupon system is installed in 134 ASDA supermarkets, turned profitable last year.

Over the last five years, Catalina's annual sales have more than quadrupled. For the year ended March 31, 1995, revenues were $113.3 million, compared to just $24.6 million in 1990. Earnings in fiscal 1995, which ended last March, totaled $17.2 million, up sharply from $12.7 million the previous year.

On Wall Street, however, Catalina's stock, which trades at a lofty 30 times earnings, has languished in a generally bullish stock market. The stock price started 1995 at about $55, fell below $45 in late spring and rallied back to $55 by mid-September.

Investors wonder whether Catalina can continue its rapid growth of revenues and earnings. Concern is that, with Catalina's electronic coupon network already in place in most of the nation's large supermarket chains, the easy growth will be over soon.

Catalina Chairman Tommy D. Greer says, "We can add another 40% to the store base, get to 13,000 or 14,000," within five years. So Catalina also seeks to grow by convincing consumer goods manufacturers to make heavier use of coupons.

That's an uphill battle. In each of the last three years, Catalina's number of printed coupons per store has been stuck at about 200,000.

It printed 1.79 billion coupons last year, less than 1% of the national total. Citing data from CMS Inc. of Winston-Salem, N.C., a major coupon clearing company, Chicago-based investment firm William Blair & Co. reports that 327 billion coupons were distributed in the U.S. last year, 88% in the form of freestanding inserts, such as the glossy coupon sections in Sunday newspapers.

In this highly specialized business, Catalina's only real competition comes from financially struggling Pompano Beach-based Advanced Promotion Technologies Inc. (APT), designer and marketer of an interactive computer checkout terminal that provides financial services as well as instant coupons. APT's system, which costs $40,000 to $50,000 per store compared to about $10,000 for a Catalina system, is installed only in about 300 stores. In the quarter ended May 27, 1995, APT lost $10.7 million dollars on revenues of only $1.4 million.

Another Catalina service, Checkout Direct, monitors household buying patterns and delivers promotions based on product-purchase frequency. Using information from shoppers' check-cashing and automated teller machine cards, Catalina has built a database of the buying patterns of about 18 million households, identified by number but not name. Manufacturers can target heavy product users by triggering a coupon when a certain shopper I.D. number is scanned at the checkout.

With its system now established in supermarkets, Catalina is trying to transfer its technology to pharmacies and general stores. Since 1990, Catalina has worked with the Grand Rapids, Mich.-based Meijer chain of general merchandise superstores, promoting everything from hunting gear to spark plugs. "We'll be in some of the new superstores. I don't know about Wal-Mart, but maybe Kmart," says Greer.

In pharmacies, Catalina produces laser-printed newsletters sponsored by manufacturers, with articles, ads and coupons, targeted at certain customers. For example, diabetics who fill a prescription would get a newsletter with information on diabetes plus coupons for related over-the-counter products. Catalina plans a rollout of the system, named Health Resource Publishing, in 1,000 pharmacies this fall.

Another venture, Catalina Electronic Clearing Services (CECS), automates the process of keeping track of coupons redeemed by consumers. Launched in November 1993, CECS is a joint venture with Spectra-Physics Scanning Systems, a maker of checkout scanners.

Traditionally, coupon clearing has been time consuming and labor intensive, with much of the counting and validating done by hand in Mexico and El Paso, Texas. But Catalina is testing a system that uses scanned coupon data collected at grocery checkouts to electronically provide manufacturers with the up-to-date number of manufacturer coupons redeemed and their value. Manufacturers can quickly determine which coupons are working and which are not. For supermarket operators, the system allows collection of coupon invoices issued to manufacturers in days rather than weeks.

"There is definitely a high level of interest by retailers and manufacturers to get that cycle down from the 45 days it now takes," says Alison Folino, senior analyst with the Smith Barney securities brokerage firm.

Catalina is the only company offering electronic clearing. Dan Granger, Catalina's president and CEO for electronic clearing, says the goal is to be profitable by 1997, and to produce revenues of $22 million and earnings per share of 40 cents by 1999. "I would view [coupon clearing] as the greatest opportunity to produce results quickly," says Peter J. Barry, a stock analyst with Deutsche Morgan Grenfell/C.J. Lawrence Inc.

Can Catalina keep adding new products and grow its original coupon business at the same time? Greer says not to worry, the company rests on a big financial cushion. Catalina has about $27 million in cash and no long-term debt.

Greer adds that internally generated cash flow is sufficient to fund the base business and Catalina's newer ventures.

But Smith Barney's Folino warns that Catalina's management must make sure the company's core business remains the primary focus. "The bread and butter still will be the checkout coupons."