Series: After Coupons, Part 1

Anyone who has been through my restaurant marketing class knows that I advocate, in many spots, coupons. There's good reason for that.

Coupons have gotten a bad name because of how the pizza companies did them: always being ho's for the dough, they practically begged customers to call them. Others followed suit with "$1 off" coupons. These only condition customers to wait for coupons (and even ask for them at the register).

They don't change behavior, they don't build loyalty. In fact, most customers lose respect for you.

So why coups? First off, Procter and Gamble spends millions on coupons every year. What do they know that we don't? P&G uses coups to guide people from being non-users, to trying products, to purchasing more product, to being loyal users. There's a method to their madness.

Second, nothing works like a freebie for new people. You can argue all you want, but when it comes down to it, with a freebie they either like you or they don't and the cost per customer gained is far, far lower than putting your logo out there and hoping someone tries you. Coupons are especially good for moving the relationship along.

Third, marketing new or existing products/dayparts/services to existing customers just makes sense. They've tried you, there is no media cost to reach them, and they're prepared to spread word of mouth. But you need to make sure you're not just giving something away, you're trading value for value. "If you do this for me, I'll do this for you."

Three uses for coupons to existing customers:
a) introduce new menu items or incentivize purchase of existing menu items (the more they have tried, the more they will love you);
b) get existing customers to try specific services (carry-out) or dayparts; or
c) increase the ticket average by adding value (get free dessert with any lobster purchase).

If you give regulars more reasons to visit, you'll see them more often. That's worth giving them a free side item, beverage, or dessert. Honest.

There are right ways and wrong ways to coupon, but most of the discussion focuses on tactics (use short expiration date). The strategy of coupons, however, should be to modify behavior and/or jump start sales (an LTO, for example).

In this series, we'll discuss four ways to market your products, with very little money and without the use of coupons.