Why Are Coupons Worth 1/100th of a Cent?

iStock / WendellandCarolyn
iStock / WendellandCarolyn

The next time a coupon shows up in your mail, take a look at the fine print. There’s a pretty good chance it will read something to the effect of “Cash Value 1/100th of a cent.” Why in the world is that writing on there? And are 10,000 copies of this coupon really worth a whole dollar? Let’s take a look at this coupon quirk.

Putting a Stamp on Customer Loyalty

Before we can answer the coupon-value question, we need to take a peek into a seemingly unrelated footnote in the history of commerce. Let’s talk about the mostly forgotten practice of businesses handing out trading stamps with purchases.

Trading stamps first found their way into merchants’ registers in the 1890s. When customers made a purchase, stores would given them stamps that reflected how much they had spent; a common exchange rate was one stamp for every dime spent on merchandise. Once a customer had saved up enough stamps – often over a thousand – they could swap them for something from the stamp company’s catalog, like a toaster or a clock.

The trading stamps were a runaway success. Supermarkets, gas stations, and department stores would advertise that they gave away a certain brand of stamps to help lure customers in, and the customers could then lick and paste their saved stamps to get “free” merchandise. Everyone was happy, and the system flourished. At one point in the 1960s, S&H Green Stamps printed more stamps each year than the Postal Service did. The circulation of the company’s catalog topped 30 million. The big stamp makers like S&H even built brick-and-mortar “redemption center” stores around the country.

As any economist worth his cost function can tell you, though, the toasters and vacuum cleaners that customers got weren’t free at all. Merchants had to pay for the stamps they gave away, and the cost of the stamp obviously got passed along to the customer in the form of higher prices.

Even in the early days, it didn’t take long for customers to figure out that the system wasn’t quite as rosy as merchants made it out to be. By 1904 New York had enacted laws that forced stamp makers to put a cash face value on each stamp that would enable consumers to bypass catalog redemptions and get money back for their stamps. Other states followed suit.

As one might guess, the individual stamps didn’t get princely face values. A 1904 New York Times piece noted that most stamp makers were given the value of “one mill,” or 1/10th of a cent. That valuation meant that a customer with a full book of 1,000 stamps could redeem it for a dollar. The same piece noted, though, that a customer who used the stamp makers’ catalogs could probably get an item worth three or four dollars for the same number of stamps, so the cash-redemption idea never really took off with most shoppers.

What happened to trading stamps? Their popularity peaked in the 1960s when nearly 80 percent of American households saved stamps, but within a decade the craze had died. Manufacturer coupons that shaved money off of items’ prices became more popular as inducements to get shoppers into stores, and the fuel crisis of the early 1970s sapped away the stamps’ large market at gas stations.

So What Does All This Have to Do With Coupons?

At first glance, coupons and trade stamps wouldn’t seem to have all that much in common. After all, coupons lower the price of an item, while the beef with trade stamps was that they passed a hidden (and often unwanted) cost along to consumers. But some states legally lump trade stamps and coupons in together, so coupons distributed in these states have to bear some printed cash redemption value.

According to the Association of Coupon Professions, only three states require this declaration of redemption value: Indiana, Utah, and Washington. Since many coupons are designed for national distribution, though, the redemption value ends up printed on all of them. As with the old trade stamps, it doesn’t really matter how infinitesimal the stated value is as long as it’s not zero. Thus, you see coupons that are worth 1/10th, 1/20th, or 1/100th of a cent.

So Can I Round Up 20 Coupons and Get a Penny?

In theory, yes. It’s hard to find reliable, concrete examples of someone schlepping in a hundred coupons to swap them out for a penny, but the web is full of anecdotes in which people “test the fine print” by trading in a giant stack of coupons for their face value at the supermarket. In all likelihood, though, you’d need to mail the coupons to the issuing company, which is a pretty lousy financial proposition given the price of stamps.

If you’re sitting on a big pile of Shake N Bake coupons, you might as well give it a try; your supermarket will probably gladly surrender a penny to ensure you don’t make a scene.

What's the Difference Between a College and a University?

Chinnapong/iStock via Getty Images
Chinnapong/iStock via Getty Images

Going off to college is a milestone in any young adult’s life. The phrase itself conjures up images of newfound independence, exposure to new perspectives, knowledge, and possibly even one or more sips of alcohol.

In America, however, few people use the phrase “going off to university,” or “headed to university,” even if they are indeed about to set off for, say, Harvard University. Why did college become the predominant term for postsecondary education? And is there any difference between the two institutions?

While university appears to be the older of the two terms, dating as far back as the 13th century, schools and students in North America have embraced college to describe most places of higher learning. There is no rigid definition of the words, but there are some general attributes for each. A college is typically a four-year school that offers undergraduate degrees like an associate or a bachelor’s. (Community colleges are often two-year schools.) They don’t typically offer master’s or doctorates, and the size of their student body is typically the smaller of the two.

Universities, on the other hand, tend to offer both undergraduate and graduate programs leading to advanced degrees for a larger group of students. They can also be comprised of several schools—referred to as colleges—under their umbrella. A university could offer both a school of arts and sciences and a school of business. The University of Michigan has a College of Engineering, for example.

While many of these traits are common, they’re not guaranteed. Some colleges can be bigger than universities, some might offer master’s degrees, and so on. To complicate matters further, an institution that fits the criteria of a university might choose to call itself a college. Both Dartmouth College and Boston College qualify as universities but use the college label owing to tradition. Schools may begin as colleges, grow into universities, but retain the original name.

People tend to think of a university as being more prestigious or harder to get into, but there are too many variables to make that determination at a glance. Some colleges might ask more of applicants than universities. Some universities might be smaller than certain colleges. Either one can be public or private.

Things get a little more convoluted abroad. In the UK, students go off to university (or uni) instead of college. The British version of college is typically a two-year program where students either focus on learning one particular skill set (much like a vocational school) or use the time to prepare for exams so that they can advance to university. Language matters, too; in Spanish, colegio usually refers to high school.

While the terms aren’t strictly interchangeable, there is enough of a difference between the two to try and make the distinction. Keep in mind that some states, like New Jersey, have rules about how institutions label themselves. There, a university has to have at least three fields of graduate study leading to advanced degrees.

Have you got a Big Question you'd like us to answer? If so, let us know by emailing us at bigquestions@mentalfloss.com.

Why Do We Eat Candy on Halloween?

Jupiterimages/iStock via Getty Images
Jupiterimages/iStock via Getty Images

On October 31, hordes of children armed with Jack-o'-lantern-shaped buckets and pillow cases will take to the streets in search of sugar. Trick-or-treating for candy is synonymous with Halloween, but the tradition had to go through a centuries-long evolution to arrive at the place it is today. So how did the holiday become an opportunity for kids to get free sweets? You can blame pagans, Catholics, and candy companies.

Historians agree that a Celtic autumn festival called Samhain was the precursor to modern Halloween. Samhain was a time to celebrate the last harvest of the year and the approach of the winter season. It was also a festival for honoring the dead. One way Celtics may have appeased the spirits they believed still walked the Earth was by leaving treats on their doorsteps.

When Catholics infiltrated Ireland in the 1st century CE, they rebranded many pagan holidays to fit their religion. November 1 became the “feasts of All Saints and All Souls," and the day before it was dubbed "All-Hallows'-Eve." The new holidays looked a lot different from the original Celtic festival, but many traditions stuck around, including the practice of honoring the dead with food. The food of choice for Christians became "soul cakes," small pastries usually baked with expensive ingredients and spices like currants and saffron.

Instead of leaving them outside for passing ghosts, soul cakes were distributed to beggars who went door-to-door promising to pray for souls of the deceased in exchange for something to eat. Sometimes they wore costumes to honor the saints—something pagans originally did to avoid being harassed by evil spirits. The ritual, known as souling, is believed to have planted the seeds for modern-day trick-or-treating.

Souling didn't survive the holiday's migration from Europe to the United States. In America, the first Halloween celebrations were a way to mark the end-of-year harvest season, and the food that was served mainly consisted of homemade seasonal treats like caramel apples and mixed nuts. There were no soul cakes—or candies, for that matter—to be found.

It wasn't until the 1950s that trick-or-treating gained popularity in the U.S. Following the Great Depression and World War II, the suburbs were booming, and people were looking for excuses to have fun and get to know their neighbors. The old practice of souling was resurrected and made into an excuse for kids to dress up in costumes and roam their neighborhoods. Common trick-or-treat offerings included nuts, coins, and homemade baked goods ("treats" that most kids would turn their noses up at today).

That changed when the candy companies got their hands on the holiday. They had already convinced consumers that they needed candy on Christmas and Easter, and they were looking for an equally lucrative opportunity to market candy in the fall. The new practice of trick-or-treating was almost too good to be true. Manufacturers downsized candies into smaller, bite-sized packages and began marketing them as treats for Halloween. Adults were grateful to have a convenient alternative to baking, kids loved the sweet treats, and the candy companies made billions.

Today, it's hard to imagine Halloween without Skittles, chocolate bars, and the perennial candy corn debates. But when you're digging through a bag or bowl of Halloween candy this October, remember that you could have been having eating soul cakes instead.

Have you got a Big Question you'd like us to answer? If so, let us know by emailing us at bigquestions@mentalfloss.com.

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