Coupons: The Good, The Bad, The Evil

Many restaurants have started to base them selves off of coupons. This in some ways may be a very successful strategy depending on what type of business you are in, but it may also hurt you. One way it may hurt you is it almost makes you look like a lower end store, or discount store. In some cases I guess thats what you may be striving for, but I know for many thats not their goal. Also you are creating customers who come in when you give them coupons but what happens when you no longer are using coupons, do they come back, or do they simply just go to another place that is using them. Now in the food industry it is not hard to replace one place with another, so if they are strictly coupon customers, do you really want that business? Also it is extremely hard to get a read on whether or not the customer was all ready a loyal customer or new. This could be a problem in a few ways, if they are not a loyal customer they fall into the coupon customers and will not be back, or are expecting you to keep prices at that range. Also you could face problems if it is a loyal customer, because they were willing to pay the full price, but instead you gave them a coupon and now you do not have as much profit on the item as you could. Now this does not mean that coupons are always bad, there are always times where a coupon can add value to your restaurant. Some places are very seasonal or tourist based, offering a coupon to draw people in is not a bad idea. For example, while in Rome Italy this summer we were walking around the Coliseum looking for somewhere to eat and the guy handing out coupons for a special deal on lunches was the winner. He knows we may be back a couple times in out life, but he is not worried about me not paying full price, because without it I probably just walk by. Also frequent user coupons can be extremely useful. Rewarding the people who do come in often with a discount or a free item can and will work, it makes them feel special and meaningful, and to some people that can be the difference in going to one restaurant or the other.