"We do believe there's a level of promotion fatigue out there," Susan Viamari, editor of SymphonyIRI's Times and Trends, told Advertising Age. "Promotion has been very high in the industry over the past couple of years, even though we did see a moderation in the growth. CPG manufacturers need to evaluate everyday pricing strategies."
The other issue, Ms. Viamari said, is that mass promotions do not account for the individual financial challenges that consumers face.
"Because more than a third of consumers are having trouble buying groceries, that option of stocking up just because something is on special is not a very easy option," she told Ad Age.
Many brand marketers and retailers are having to reassess their promotional practices in light of diminishing returns.
Those moving to social media and daily deal services such as Groupon and LivingSocial may find that the hoped-for lift from these sources is not there either.
Research by Infegy's Social Radar found, for example, that while consumers talked more often about great deals being offered last year, those discussions did not translate into overall higher sales for the products being talked about.
Ad Age also reported on a survey by researchers at Rice University that found nearly one-in-three businesses found using Groupon to be unprofitable and that consumers became less responsive as more deals were offered.
Utpal Dholakia, a marketing professor at Rice who conducted the survey, told Ad Age, "My theory is that as time passes there's a little bit of jadedness about using Groupons because then they become just like any other coupon."