Used sometimes as an incentive and other times as a marketing technique, discounting has been used by restaurants for years, but it has its pros and cons.  Consumers look for discounts everywhere they go, especially with the economy in the state it is.  Restaurants can use discounting to get customers in, but they should be wary about using it too much.

Customers love a deal.  Getting any percentage off a meal is enough to get them into a restaurant.  By picking the right products to discount, restaurants can use discounts as a great promotion for existing and future customers.  It can help generate more business during slow times or get new customers to come in and give the restaurant a try.  Loyal customers will also be happy with receiving something for free for their loyalty and will enjoy the unique experience of a deal at their favorite restaurant.

While getting a deal is good for customers, it can change how they view a restaurant.    Studies done on Groupon discounts showed that businesses that ran discounts through Groupon received about ½ stars lower on reviews on Yelp.  Customers see that a restaurant is giving discounts and associate that lower price with a lesser quality product.  Even if the product has not changed, the mere fact that the restaurant is willing to lower the price in the mind of the customers means that the quality is lower.

Discounts sound like a good idea, but they are a technique that needs to be used carefully.  With the proper use, restaurants can use discounts to help push traffic into their restaurant.  However, restaurants should be careful not to over discount and ruin the reputation of their restaurant and brand.

Savanna Eckenrode
MenuDrive
www.menudrive.com

Tags: discounting

Posted in Marketing Tips