Being from out of town, I always look forward to heading home for the holidays. Of course once I’m there for a few days I look forward to getting back, because let’s be honest, you can only take so much family for so long.
This year was a little different from most in that when I got back, there was a truly stunning box of mail waiting for me at the neighbor’s house. Sure there were a few letters and bills in there, but the vast majority of it was direct mail, catalogs and especially coupons.
Which got me thinking: if couponing is a measure of how tough the economy still is, the recovery must still be some months off. If things were normal, would so many businesses be trying to get my attention in this way? Would they be offering me such deep discounts on their products?
And because my mind just naturally works this way, my next thought was: I hope the economy turns soon, for the sake of all these brands. Because while there’s no question that in tough economic times coupons keep revenues flowing and businesses afloat, they can only be kept up for so long before they begin to serious erode the viability of a brand.
Why? Because coupons teach consumers to view brands through just one very narrow lens: the lens of price. The more a brand relies on coupons, the more consumers come to see that brand as a price competitor and nothing more. And that’s a bad place to be — a place of narrow margins and fierce competition where customer loyalty can’t be earned, only bought…usually with more coupons.
Does that mean there’s no place for coupons during good economic times? Not at all. Product rollouts are a great example of a healthy use of coupons, when customers need to be incented to try something new. There are of course others. The main thing to remember about coupons is that they need to be used judiciously, lest they become an end in themselves, a survival tactic that a business can’t live without.
With the economy starting to turn, now is a great time to start thinking about brand building: focusing customer attention on the value-adding features of products, and on the one-of-a-kind experiences that will keep them coming back for more.
Of all the businesses that have been affected by the pandemic, it’s hard to find one that’s taken more hits than the restaurant industry. With