Valassis Accused of Using Hidden Identities in Online War With News America Marketing

Has a Valassis executive been using a “sock puppet” (a fake online identity) to criticise News America Marketing? That’s the claim of Joe the Coupon Guy, a blogger who writes about (you guessed it!) coupons. News America has retained a lawyer to see whether it can sue Valassis over the alleged false posts, Joe tells BNET.

Valassis angered the surprisingly large and feisty world of coupon bloggers earlier this year when it became clear that the company was pulling newspaper coupons and replacing them with online printouts and direct mail. Couponers prefer newspaper coupons because they can buy mulitple copies and double-up on the discounts; web and mail prevent that.

In message boards on BringBacktheCoupons.com, many couponers vented against Valassis. Some defended the company, but under about half a dozen of the posts, Joe wrote:

The IP address that posted the above message is from a server belonging to Valassis Communications (the publisher of the Red Plum Coupon Insert booklet). The person who posted this message is distorting the truth.

Joe (real name Joe Daugirdas, who by day is a mild-mannered IT manager at company that has nothing to do with coupons) identified “Jane” and “Max” as posting from a Valassis-owned IP address in their online messages. “Max” argued (falsely) on BringBacktheCoupons.com that the site was owned by News America:

… did you know who created this web site? News America Marketing, the suppliers of Smart Source! I’ve heard about some low tactics, but pretending to be concerned consumers with a grass-roots effort all in an effort to discredit your competition.

Urrrggghhh! Can’t we even have an honest consumer uprising without finding out we are just shills for the man?

“Jane” took the side of packaged goods clients against multiple coupon users:

While consumers may find this hard to believe, manufacturers don\’t actually want people buying 10 newspapers to use 10 coupons on their products.

“Jane” left an almost identical message on BNET, but this time she used the name “Duhki.” The message began:

As an advertising executive that has worked with Valassis and News America for over 20 years as an advertiser within their FSI products, I have a slightly different opinion on this matter…

That sounds like someone who is not currently employed at Valassis, but Joe claims the comment came from a Valassis address.

Joe said he received a phone call from Axel Bernabe (pictured), a senior associate at the law firm Constantine Cannon, and that Bernabe was calling on behalf of News America regarding the alleged false posts, and that a lawsuit was either filed or in the offing. It could not be confirmed whether News America has filed suit against Valassis. Bernabe did not return a call for comment; Valassis did not immediately return a call.

Here’s a digest of the alleged false posts on BringBacktheCoupons.com:

Max (last name withheld)   - Don’t be a corporate pawn!           |February 24,2009 10:53pm
Dont be a corporate pawn!

I too feel your pain, at least the pain of all of the “real” people that have posted on here.

But, did you know who created this web site? News America Marketing, the suppliers of Smart Source! I’ve heard about some low tactics, but pretending to be concerned consumers with a grass-roots effort all in an effort to discredit your competition.

Urrrggghhh! Can’t we even have an honest consumer uprising without finding out we are just shills for the man? Hey, News America — don’t enlist me to fight your battles and don’t pretend to care about us when you obviously have ulterrior motives.

Everyone, continue to post if you want, but just be aware of who owns this blog! No wonder they had so much info on the clients, newspapers, etc. Sneaky!

But, continue to spread the word — let’s get coupons back in the newspaper. I will do my part — I am just not going to support a company that tries to use me!

Max

Note from the site editor:
The IP address that posted the above message is from a server belonging to Valassis Communications (the publisher of the Red Plum Coupon Insert booklet). The person who posted this message is distorting the truth.

This site is run by the same group of people that rallied together to get Giant Eagle (a major grocery chain in Ohio and Pennsylvania) to bring back double coupons. We are all fellow couponers and nobody is affiliated with Smart Source or any other competitor of Valassis. We just care about our finances and those around us.

We appreciate a company like Valassis that distributes coupons and we want them to change their decision so that couponers can have access to the coupons they want. What we are emphasizing will help Valassis in the long run. We respect people associated with Valassis to voice their opinion and there is no need for them to hide behind any alliases or false asssumptions. This is the U.S.A. and we welcome the freedom of speech, however we have the right to discard any posts that are foul with inappropriate language.

+++
Jane   - Not surprising           |February 24,2009 11:02pm
Max,

Why doesn’t this surprise me. I have worked with both News America and Valassis for years. While neither company’s sales staff can be considered angels, the News America crew can be particularly ruthless.

I remembered this posting in DM News from quite some time ago I had save in my email:

In its introduction in the lawsuit, Valassis said that News America COO Paul Carlucci shows his sales force a vignette from The Untouchables that shows Al Capone beating one of his enemies to death with a baseball bat. Valassis claims the scene is a metaphor for the business practices that News America expects of its sales force and employees to illegally leverage its market dominance in the in-store advertising and promotions market to gain an unfair advantage in the coupon market, the documents said.

Jane

Note from the site editor:
The IP address that posted the above message is from a server belonging to Valassis Communications (the publisher of the Red Plum Coupon Insert booklet). The person who posted this message is distorting the truth.

This site is run by the same group of people that rallied together to get Giant Eagle (a major grocery chain in Ohio and Pennsylvania) to bring back double coupons. We are all fellow couponers and nobody is affiliated with Smart Source or any other competitor of Valassis. We just care about our finances and those around us.

We appreciate a company like Valassis that distributes coupons and we want them to change their decision so that couponers can have access to the coupons they want. What we are emphasizing will help Valassis in the long run. We respect people associated with Valassis to voice their opinion and there is no need for them to hide behind any alliases or false asssumptions. This is the U.S.A. and we welcome the freedom of speech, however we have the right to discard any posts that are foul with inappropriate language.

+++
Jane   - P&G eSaver           |February 24,2009 11:02pm
This loads coupons and values on to your frequent shopper card and send you samples and coupons in the mail. I don\’t know that you can print out coupons, and if so I am unaware of that feature.

If the manufacturers wanted consumers to have unlimited coupons, why wouldn\’t P&G just put all of the coupons that are in the Sunday paper online and let you print out as many as you want?

Jane

Note from the site editor:
The IP address that posted the above message is from a server belonging to Valassis Communications (the publisher of the Red Plum Coupon Insert booklet). The person who posted this message is distorting the truth.

This site is run by the same group of people that rallied together to get Giant Eagle (a major grocery chain in Ohio and Pennsylvania) to bring back double coupons. We are all fellow couponers and nobody is affiliated with Smart Source or any other competitor of Valassis. We just care about our finances and those around us.

We appreciate a company like Valassis that distributes coupons and we want them to change their decision so that couponers can have access to the coupons they want. What we are emphasizing will help Valassis in the long run. We respect people associated with Valassis to voice their opinion and there is no need for them to hide behind any alliases or false asssumptions. This is the U.S.A. and we welcome the freedom of speech, however we have the right to discard any posts that are foul with inappropriate language.

+++
Jane   - P&G does online coupons              |February 24,2009 10:59pm
Even when you load the coupons on to your frequent shopper card, P&G gives the following disclaimer:

*Limit one use for each coupon.

Trust me, the retailers really want consumers using just one coupon. Personally, I too like using multiples — I use 2-3 Pampers coupons every time I buy diapers.

I\’m just trying to point out why manufacturers are not going to be \”supportive\” of consumers inability to get multiple coupons. They may not come out and say it, but they only want you to have one coupon. Keep fighting the good fight, but direct your anger toward the manufacturers — there are so many other ways that they could get multiple coupons into our hands or allow us to use a coupon for multiple products. It just isn\’t about SmartSource, or Valassis, or newspaper, or mail, it\’s all about the manufacturer. They could choose to allow one coupon for multiple products and they don\’t. They could allow multiple coupons to be printed online and they don\’t. At the end of the day, mail isn\’t prohibiting you from getting multiple coupons, the manufacturers are.

Note from the site editor:
The IP address that posted the above message is from a server belonging to Valassis Communications (the publisher of the Red Plum Coupon Insert booklet). The person who posted this message is distorting the truth.

This site is run by the same group of people that rallied together to get Giant Eagle (a major grocery chain in Ohio and Pennsylvania) to bring back double coupons. We are all fellow couponers and nobody is affiliated with Smart Source or any other competitor of Valassis. We just care about our finances and those around us.

We appreciate a company like Valassis that distributes coupons and we want them to change their decision so that couponers can have access to the coupons they want. What we are emphasizing will help Valassis in the long run. We respect people associated with Valassis to voice their opinion and there is no need for them to hide behind any alliases or false asssumptions. This is the U.S.A. and we welcome the freedom of speech, however we have the right to discard any posts that are foul with inappropriate language.

+++
Jane   - The real story              |February 24,2009 11:01pm
As an advertising executive that has worked with Valassis and News America for over 20 years as an advertiser within their FSI products, I have a slightly different opinion on this matter.

Let\’s look at the pure economies of scale… newspapers are losing readership (and have been for years). The Cleveland Plain-Dealer (the impetus for much of the negative blog posting)lost 2.7% Sunday circ. from 2004-05, -1.6% in 05-06, -1.4% in 06-07 and the 07-08 figures will not be pretty. Advertisers are looking to reach as many people as possible with their advertising in the most cost-effective manner. The fact is that, while this small group of bloggers and supporters may think that their purchase of multiple copies of the newspapers is a powerful driver of successful ROI, the fact is that if an advertiser can reach 10%, 20% 30% or 40+% more people by using the mail for the same cost per person as using a newspaper, that is a good thing!

The inability of a small (but vocal) group of people to buy multiples of a product using multiple coupons is significantly offset by the ability of an advertiser to reach hundreds of thousands of new consumers who might buy their products.

While consumers may find this hard to believe, manufacturers don\’t actually want people buying 10 newspapers to use 10 coupons on their products. They would much rather have 7 new people each use one coupon? Really? They would rather sell 7 items instead of 10? Yes! Coupons are about trial — the goal isn\’t to give multiple coupons to a single person — it is to engage a large group of people to try the product and hopefully become regular consumers. To do that, you need to get your coupons in the hands of the most consumers.

If anyone believes that the manufacturers want them using multiple coupons at one time, they need to know that is not reality. That is why there isn\’t a coupon every week for the same product. That is why manufacturers are embracing the move to distribution via direct mail. That is why P&G (the largest pckaged goods company in the world) does not advertise online — they are worried about coupon fraud (i.e., consumers printing multiple copies). By that same argument, they would consider the buying of 10 copies of a newspaper to be \”newspaper fraud\”. In other words, they don\’t want people using 10 coupons. They want you using one coupon and then returning to purchase more of the product at the regular price. If manufacturers really wanted you to buy multiples with coupons, they could provide coupons that can be used on the purchase of \”up to 10 products\”. Then you only need one coupon and can buy as many of each product as you need. Ask yourself why they don\’t do this.

Additioanlly, the newspaper business is in danger, and it\’s got nothing to do with Red Plum moving to mail (I find the posts claiming that Red Plum moving to mail will put the newspapers out of business). The newspapers haven\’t needed any help with that. In the last 2-1/2 months, 33 newspapers have filed for Chapter 11 bankruptcy, including the Los Angeles Times, Chicago Tribune, Minneapolis Star-Tribune, Philadelphia Inquirer and many more. Oh, all of these newspapers carry SmartSource and Red Plum, yet they are failing financially.

We really can\’t blame Red Plum for listening to their advertisers and providing a strategic solution (with shifts to mail and online couponing) that increase the coverage for their advertisers, allow more consumers to have access to their coupons and provide an option should newspapers close or cease business (like the Rocky Mountain News)?

Bloggers, while disappointed that they no longer have access to 10 coupons for their favorite product should be thankful that hundreds of thousands of other consumers in their market can now receive coupon discouts during this financially dificult time. They should be excited that, should their newspaper cease operations, they will still be able to receive their Red Plum coupons in the mail. And they should be pushing their retailers to accept online coupons (if they currently don\’t). Finally, they should be making friends with their neighbors, because if they want extra coupons, all they need to do is ask their neighbors if they can have theirs (and they don\’t even need to buy extra newspapers to get them).

Note from the site editor:
The IP address that posted the above message is from a server belonging to Valassis Communications (the publisher of the Red Plum Coupon Insert booklet). The person who posted this message is distorting the truth.

This site is run by the same group of people that rallied together to get Giant Eagle (a major grocery chain in Ohio and Pennsylvania) to bring back double coupons. We are all fellow couponers and nobody is affiliated with Smart Source or any other competitor of Valassis. We just care about our finances and those around us.

We appreciate a company like Valassis that distributes coupons and we want them to change their decision so that couponers can have access to the coupons they want. What we are emphasizing will help Valassis in the long run. We respect people associated with Valassis to voice their opinion and there is no need for them to hide behind any alliases or false asssumptions. This is the U.S.A. and we welcome the freedom of speech, however we have the right to discard any posts that are foul with inappropriate language.

+++
Jane   - Let me clarify              |February 24,2009 10:58pm
Okay, I anticipated some response, and I wasn\’t expecting it to be positive. But there were some questions asked, so the least I can do is to answer them.

Barbara,
I personally have not placed ads for the remnant or direct response advertising that you reference. But, I can tell you that both SmartSource and Red Plum carry remnant and direct response advertising. Both companies also accept only up to a certain percentage of remnant/direct response in their books, so there will always be some level but it will never be the majority of the books. Each company contains about the same percentage of remnant/direct response in proportion to their regular advertisers. So, Red Plum doesn\’t have more, but when there are less pages of regular advertisers, the remnant ads likely stand out more.

Charles,
Sorry to burst your conspiracy theory, but I don\’t work for (and have never worked for) Valassis. I work for advertising agencies as a media consultant in Los Angeles. I specialize in print media and have placed business with both News America and Valassis for over 20 years, so I am pretty intimately involved with their products. As such, I understand the vendors, the manufacturers and as a coupon-user myself, the consumer.

I don\’t think I have lost touch with the consumers of America, since I am one. I have the same financial issues as the rest of the population and use tons of coupons every week for my family, including multiples just like the posters on here.

I\’m not at all upset at the existence of this website, although I can\’t speak for the perception of any Valassis posters. I don\’t have a vested interest in the stock of Valassis. I personally think that shared dialogue is great — I just wanted to provide some alternative information. Obviously, you feel like this site should be available for posting of like-minded thoughts, regardless of whether or not the facts are accurate. I thought that a posting that provides the thoughts and rationale of the other side of the fence would be appreciated.

I did not invent the phrase \”coupon fraud\”. That is a common online term and one in which every major packaged goods advertiser is concerned with. Here is an example of how online sites deal with the situation (notice that they limit the number of coupons — this is at the manufacturer\’s requests):
\”Responding to fears of consumer abuse, technology providers now employ sophisticated methods of thwarting fraud,” according to Forrester. Examples include coupon site E-centives, which has a downloadable plug-in that communicates with an offsite server to limit the number of coupons printed per PC.\”

Barbara,
As I said to Charles, I really have no interest in the stock price of Valassis. I wasn\’t aware that it was being delisted, but given their share price, it isn\’t surprising. I don\’t really know what that means, but to say that you don\’t see the same thing happending to News America or other major companies is crazy. There are plenty of strong, good companies whose stocks are beaten down right now. Valassis\’ stock is down 85% over the last year (but up over 15% today). News America\’s stock is down 66% over the last year. Heck, Target stock is down 47% and Google is down 27%.

As far as the quality of what you are getting in Cleveland, it is difficult to say what is happening. It sounds like you have a problem with your postal carrier. Just as if your newspaper didn\’t arrive and you would call the newspaper to complain about your carrier, you should call your post office to complain if your mail isn\’t arriving, regardless of whether it is the Red Plum coupons, a birthday card or anything else.

In all likelihood, your mailed Red Plum in Cleveland should contain the same coupons that people are getting through the Akron Beacon newspaper. They may, of course, be different than what I get in LA, but seeing a lot of remnant could be specific to a week where the book was small and the remnant stood out more — that varies week to week and market to market. But in general, samples I have seen from mailed markets don\’t appear significantly different than those from newspaper markets.

As far as you boycotting any company that advertises in Red Plum, I know that my clients would be disappointed to hear that. But you have to understand that I help them make decisions that help them receive the best ROI. That means spending the least to sell the most. While we would never want to alienate a shopper, it is important to continue to find new ways to reach more consumers. If we were advertising on a television program that lost many viewers and was reaching only a portion of the consumers that it used to, we would look at other solutions. We wouldn\’t just keep using it because we always had. In this case, Valassis seems to be in a similar situation, dealing with a distribution vehicle that has diminished in certain markets in such a way that they just no longer reach enough people. Personally, I get the Sunday newspaper as well as coupons in the mail and I look at and use both of them. Traditionally, grocery coupons have been distributed in the newspaper, but guess who started that? Valassis. So, if anyone is going to try something new, I guess it should be them. I know that in my business, I appreciate them being forward-thinking and trying something new, rather than waiting until it\’s too late. Sure, it\’s not going to make everyone happy, and not every one of my clients agrees with their direction. And, I would personally miss getting the FSI in my newspaper. But, we\’re in an interesting time and companies need to embrace change to survive — I\’m just more willing than some I guess to see the other side of the equation and the potential benefits it might bring long-term.

Jane

Note from the site editor:
The IP address that posted the above message is from a server belonging to Valassis Communications (the publisher of the Red Plum Coupon Insert booklet). The person who posted this message is distorting the truth.

This site is run by the same group of people that rallied together to get Giant Eagle (a major grocery chain in Ohio and Pennsylvania) to bring back double coupons. We are all fellow couponers and nobody is affiliated with Smart Source or any other competitor of Valassis. We just care about our finances and those around us.

We appreciate a company like Valassis that distributes coupons and we want them to change their decision so that couponers can have access to the coupons they want. What we are emphasizing will help Valassis in the long run. We respect people associated with Valassis to voice their opinion and there is no need for them to hide behind any alliases or false asssumptions. This is the U.S.A. and we welcome the freedom of speech, however we have the right to discard any posts that are foul with inappropriate language.

• See BNET’s previous coverage of the in-store marketing wars:
• News America Marketing Forces Whistleblower Into Bankruptcy
• News America Marketing Whistleblower: Clients Were Charged for Ads That Never Appeared
• Was N.Y. Post’s Carlucci the Reason for News America Marketing’s Settlement With Floorgraphics?
• News America Marketing’s Alleged Plans to Seize Safeway Account Outlined in Suit
• Valassis to Stick With “Majority” of Newspapers; Settles Fraser Billing Dispute
• Valassis, Insignia Stock Jumps on News America Marketing Group Settlement
• Valassis CEO Got Big Raise Despite Company’s Losses
• News America Marketing Group Wins Summary Judgment Against Whistleblower Robert Emmel
• News America Marketing Group Buys Floorgraphics Just Hours After Settling Spying Lawsuit
• News America Marketing Group Settles With Floorgraphics; Valassis, Insignia Likely Rejoicing
• Valassis May Not Be Able to Pay Debt; Litigation May “Materially Harm” the Company
• Trial: Did News America Marketing Group Break Into Floorgraphics’ Computers?
• Valassis Stock Threatened With De-listing by NYSE
• Valassis’ Plan to End Newspaper Coupons Outrages Middle America
  
• Valassis Suit vs. News America Being Conducted in Secrecy
  
• Valassis: Layoffs Will Continue as It Reduces Newspaper Coupon Business; It’s All News America’s Fault
• Valassis Writes Down $245 Million in Assets; Legal Bills Running at 10% of Profits
  
• Valassis Angers Blogger Moms by Yanking RedPlum Coupons From Newspapers
• Valassis Reduces the Cost of Fun for Employees
• Direct Mail Giant Valassis Is “Not Paying Its Bills”; Stock Is “Worth $0”
• The Cost of Valassis’ Suit vs. News America Is Eating Its Profit