Trading Stamp Boom

June 14, 1956

Report Outline
Rapid Growth of the Trading Stamp Fad
Retailers and the Economics of Stamp Use
Giveaway Factor in Appeal to Customers

Rapid Growth of the Trading Stamp Fad

Despite price wars, federal investigations, and threats of legal sanctions, a craze for trading stamps—worked up by the ever-appealing promise of something for nothing—is spreading through the country's retail stores and markets. Merchants themselves are of two minds about the phenomenon. Some have found it an effective means of rapidly expanding sales volume. Others, disturbed by the added cost of doing business, have attempted to fight it by cutting prices but have been forced in the end to join the parade. A few have gone to court to test the validity of trading stamp operations under fair trade laws, or to state legislatures to press for statutes to outlaw the practice directly.

The Senate Small Business Committee has asked two federal agencies—the Federal Trade Commission and the Department of Agriculture's marketing division—to survey trading stamp developments and help the committee decide whether action by Congress is needed. The Trade Commission already has launched a study into the question of whether or not trading stamp plans contravene existing fair trade regulations. The marketing division will initiate an investigation next month on the effect of trading stamp operations on the costs of marketing farm produce.

Meanwhile, collection of trading stamps is attaining the proportions of a national pastime. Trade sources assert that half the housewives of the nation are confirmed stamp collectors and that they heartily favor a system of merchandising which appears to give them luxury articles at no cost. In some cities virtually every sizable retail store issues stamps to customers who purchase its goods. The independent companies which install and operate stamp plans for retailers are undertaking a massive advertising campaign in an attempt to make the entire country stamp-conscious.

ISSUE TRACKER for Related Reports
Consumer Behavior
Retail Trade