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The Death of 1,000 Cuts

July 7, 2014

Returning to the region, there are a few things that immediately stick out as being different from other places.

First and foremost is the population density, or more precisely the lack thereof. Coming from both the south and the east the traffic falls off precipitously the closer you get to the Capital Region. And stopping into a local Price Chopper at 10 p.m. on a weeknight was like stepping into a ghost town.

Second, a surprising number of people don’t seem to care about how they look. Specifically, my observation isn’t about physical beauty or expensive brand name clothes. But rather the choices people make when they decide what to wear outside their homes. I know for a fact that there are people who are nicely put together around these parts. But they are so outweighed by the other end of the spectrum that the visual landscape of humanity doesn’t paint a pretty picture.

Third, our region’s arguably most famous restaurant advertises in the coupon clipper magazine.

Today, let’s put aside the fascinating issues of population. Fashion is something you’ll probably never hear me mention ever again. But magazines, advertising, and restaurants are squarely in my wheelhouse. And I hate to see Jack’s Oyster House and others tearing down their brands one clip at a time.

For those who don’t know, Clipper Magazine is a free periodical which is routinely delivered by mail to people’s homes. Nobody subscribes to it. It just comes. Nobody requests it, it gets mailed whether you want it or not. A long time ago, that used to be known as junk mail.

To try and create value around this junk, Clipper Magazine is filled with coupons. And honestly, some of them are quite good. A long long time ago, I think there was a $10 off $40 at the Honest Weight Food Co-Op where one could effectively enjoy a working member’s discount for a small basket of goods.

Now, I’m a fairly savvy shopper and will take advantage of high value coupons to save a few bucks. That isn’t to say that I’m even on the same plane of existence with serious couponers who seem to get their groceries for free through some kind of sorcery that I haven’t the time nor inclination to learn. Nor am I a Grouponer, since I know myself too well.

And I’ll totally use coupons for something like pizza delivery. Coupons and calling out for pizza seem to go hand in hand. There are even a handful of $10 off $30 coupons in the City Dining Card Deck that I may use for casual restaurants.

But for a nicer restaurant, couponing is a dangerous game.

I’ve long argued that most of the more expensive restaurants in the Capital Region are priced higher than they should be given the food that’s being served. Attempting to lure people in with the promises of a more reasonably priced meal is a tacit acknowledgement that a restaurant is charging too much. And ongoing couponing gets consumers used to a new normal of what the prices of a restaurant should be.

But most importantly it cheapens the brand. Here’s an analysis from Ray Coen in Businessweek:

Discounting of any type brings in three kinds of customers. One is there strictly for the discount and will not develop any loyalty to your business because they only go to places where there is a discount offered. The next group, probably the largest, is your current customers. They may increase business because they’re accelerating their visits when you’re offering a discount, but after a few visits they’ll wonder why they ever pay full price—and they’ll only come in when you have a discount…[The third group] consist of new visitors who are introduced to your business by the discount offer, but unfortunately they’re usually too few in number to make up for the harm done.

Coen suggests that changing a restaurant’s pricing and positioning work better than discounting. I couldn’t agree more.

Jack’s Oyster House is a local institution that has been around for more than 100 years. Sure, there are people moving to the area all the time, and perhaps they need to be made aware of its presence. But there has to be another way.

Oddly, the latest installment of Clipper Magazine just had an ad for Jack’s on the cover without any coupon. In some ways this is even worse because it’s a tease. The brand has gotten readers of the Clipper accustomed to seeing their coupons, and this month there’s a big front cover ad without any payoff.

But I don’t want to pick on Jack’s unfairly. There are plenty of other pricier restaurants sandwiched in this flyer between coupons for Arby’s, KFC, and a handful of local pizza joints.

Chez Mike, Grappa 72, La Serre, and Risotto, I’m looking at you.

The coupons aren’t free. They cost these small businesses money out of their pockets. And it’s money that I think could be better spent. If high prices are keeping potential patrons away, deal with that head on.

Coupons can look like a sign of desperation. That may or may not be the case. But they are certainly the sign of a lack of marketing imagination.

5 Comments leave one →
  1. July 7, 2014 11:14 am

    I am definitely someone who falls into the second category. However, I know that it does entice me to my favorite places more frequently. Coupons rarely entice me to places I would not normally try. C and I have given into Groupon in the past and while we didn’t have negative experiences with places that used it, we did often find ourselves scrambling to use up the Groupons in time. I mostly stick to Groupon Goods or fitness related Groupons now (though now I have a gym membership, that is generally moot).

    The City Dining Cards are an exception to this. I love the whole model of this program, especially that a portion of the proceeds go to a worthy charity.

  2. July 7, 2014 11:23 am

    Grocery Sorcery.

    Let’s all wear wizard hats to Price Chopper at 10pm.

  3. July 7, 2014 12:45 pm

    Hrm… I am the opposite. I can’t stand watching ladies traipse around Hewitts in heels or men in skinny jeans and hairdos shopping at Hannafords. Give me frumpy unadorned and honest folk as far as the eye can see. But I guess I spend have spent most of my adult life around other dudes in uniforms so my opinion may have been affected by conditioning over time. Plus I pretty much only dress in black, white, and beige…

  4. July 7, 2014 4:57 pm

    Coupons are the crack cocaine of the industry. Once places get hooked they find it hard to stop. The coupon/ discount crowd starts to edge out the loyalists and eventually service starts to suffer. Lots of ‘high maintenance’- low return issues that seem to be pervasive amongst the clipper crowd. Which, in turn, drags service and morale down…thus causing more decay.

    I could go on for hours ;)

  5. Mr. Sunshine permalink
    July 10, 2014 10:24 am

    I too have noticed the general slovenliness of Albanians on the street and wondered about it.

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