How to Run a Successful Coupon Marketing Campaign

Coupons play a significant role in the restaurant industry, acting as powerful marketing tools that can benefit your business in several ways. Not only do they help to attract new customers to your establishment, but they also encourage repeat business, leading to increased sales and overall success. When strategically designed and distributed, coupons can effectively drive traffic during slower periods and promote specific menu items. By featuring discounted meal deals or limited-time promotions, you can create a sense of urgency, motivating customers to act quickly and make a purchase.

Types of Coupons

Coupons come in several forms, each of which lends itself to a different use. As a result, you should consider which type of coupon best suits your business's needs before making a decision.

• Flat-rate coupons: With flat-rate coupons, you can give your customers a flat discount, such as $5 or $10 off their entire bill. This encourages customers to spend more money to qualify for the discount, increases the average order value, and boosts overall sales. To protect profits, consider setting a spending minimum for guests to use the coupon.
• Percentage-based coupons: This type of coupon involves discounting menu items by a certain percentage, such as 15% or 20%. These discounts are ideal for restaurants that offer affordable prices to begin with, encouraging customers to order more when they see that a portion of their bill will be discounted. By marking the bill down by a certain percentage, restaurants can attract customers looking for a good deal while maintaining a profitable margin.
• Buy one, get one deals: These coupons enable customers to purchase one menu item at its regular price and receive a second item for free or at a discounted rate. In some cases, restaurants may create a dedicated buy one, get one menu with a specific selection of items eligible for the promotion. This can help streamline the ordering process and make customers aware of the foods on your menu.
• Combo deals: Combo deals are especially effective with customers looking for a complete dining experience. With combo deals, customers can order multiple menu items at a discounted price. By combining two or more menu items into one discounted package, businesses can dramatically increase customer satisfaction.
• Loyalty programs: These programs offer exclusive rewards and coupons to repeat customers. Whether you're allowing guests to create an account with their email or tracking loyalty rewards through your app, a restaurant loyalty program makes it easy to reward customers for their continued support.

Coupon Distribution

Distributing coupons is a crucial aspect of restaurant coupon marketing. Building an understanding of how to distribute coupons effectively is the key to a successful coupon marketing campaign. We'll outline common ways that restaurants distribute coupons below.

• Email: Email marketing allows for a high level of personalization and customization, making it ideal for targeting specific customer segments. By segmenting your email list based on customer preferences, you can send offers that are more likely to resonate with your audience.
• Text: Text messages have a higher open rate than emails, increasing the likelihood of customer engagement. Moreover, you can enhance your marketing campaigns with geofencing technology, sending location-based coupons to customers within a certain radius of your restaurant.
• Apps: With an app, you have the advantage of push notifications, which provide instant alerts to your customers' smartphones. You can remind customers of rewards they haven't redeemed, inform them of new promotions, or send marketing messages when they are near your restaurant.
• Social media: By utilizing your restaurant's social media channels, you can send exclusive deals directly to loyal customers. This approach encourages repeat business and increases brand exposure as followers share and engage with your content.
• Print: Printed marketing materials can be local newspapers, magazines, and newsletters. They can also appear in coupon books printed by your local Chamber of Commerce. Print distribution is also ideal for establishments that service an older community, as older customers are more likely to look for coupons in newspapers and magazines.
• Websites: Sites like Groupon offer customers discounts for a variety of foodservice establishments. While advertising through these sites can increase exposure, the site may charge you a fee or take a cut of your profits in return.

Advantages and Disadvantages of Coupons

An effective coupon marketing campaign takes a variety of factors into account. While coupons can be an effective way to increase sales, they come with their own set of advantages and disadvantages. Before you start distributing coupons, consider these pros and cons to ensure your strategy aligns with the goals and needs of the business.

Coupon Advantages

Coupon marketing can aid your restaurant in many different ways, and we've listed some of the most common advantages associated with them below:

• Attracting new customers: By offering discounts and special promotions through coupons, you can entice new guests to dine with you.
• Establishing repeat customers: Offering coupons that are redeemable on future visits incentivizes customers to return. This increases customer loyalty and builds long-term relationships with your patrons.
• Upselling: When customers come in with a coupon, your staff can upsell additional items or upgrades, increasing the average check size and providing customers with a more fulfilling meal.
• Strengthening brand recognition: When customers receive coupons and use them, they become more familiar with your restaurant’s brand. This increased exposure can lead to word-of-mouth recommendations and repeat visits, further solidifying your restaurant's presence in the minds of consumers.
• Boosting sales: By offering limited-time discounts or promotions during off-peak hours or seasons, you can entice customers to visit your restaurant when business is typically slower.

Coupon Disadvantages

While coupon marketing can be an effective tool, implementing a poor coupon marketing strategy can negatively impact your business. Keep the following factors in mind as you plan your coupon marketing approach.

• Impact on profits: Offering discounts on your products or services means selling them at a lower price than usual. While this can bring in new guests and incentivize repeat purchases, it is essential to calculate the impact on your bottom line. Without properly assessing the cost of offering discounts, you may inadvertently reduce the profitability of your business.
• Diminished tips: When customers use a coupon to pay for their meal, the reduced bill can result in lower tips. This can be discouraging for servers who rely on tips as a significant portion of their income.
• No guarantee of redemption: While some customers may be enticed by the discount and choose to make a purchase, others may forget to bring the coupon or change their mind altogether. This can lead to a loss of potential sales and may not result in the desired return on investment for your coupon campaign.

When used correctly, coupons can play a significant role in the success of your business. By leveraging their power to attract new customers, encourage repeat business, and increase sales, you can promote your restaurant and drive long-term success. Implementing a well-designed coupon marketing campaign can help you stay ahead in a competitive market while delighting both new and loyal customers.