NEWS & EVENTS

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Local marketing – are deals and discounts going to produce long-term customers?

I was once told by a prospective restaurant client that running a coupon (or deal) seemed like a much more economical proposition than offering new movers moving into his area an invitation to try his business shortly after their move. After looking into this, it was concluded that while it may seem inexpensive on the surface to mass market using a coupon or a deal (shotgun marketing), the long-term cost of a shotgun is much more than a rifle (new mover marketing). After further analysis, it was further concluded that the rifle generated this particular restaurant customer an astounding $90,000 Gross Profit in a 12-month period.

While any business may market to the masses through a deal site or via coupons, what they are going to typically find is a one-time customer looking for a deal. What I mean by this is that the types of customers that businesses are going to gain are what we consider “deal shoppers”. These are one-time customers looking for a one-time deal. As well, customers that are already loyal and willing to pay full price may begin to wait for deals – ultimately leading the business to unnecessarily discount their current customer base. Furthermore, from my experience, the deal shoppers tend to spend very little above and beyond the discount.

A business must ask itself, “If I run a coupon next week, will I get loyal customers? Or, if my competitor runs that same coupon next week, will all the coupon customers I gained turn around and go to his company for the coupon offer?” Research states overwhelmingly “YES” and that they may only go back to that particular merchant if they again receive that coupon deal. The coupon responders, or “coupon clippers” are going to find the Best Deal when they want to go to a restaurant, service provider or retailer – no loyalty.

While I am not saying that running a coupon or deal a bad principle, what I am hoping to convey is that with a new mover program you are going to attract new loyal customers who will spend money with you for years to come. For example, say you move to Charlotte, North Carolina from San Diego, California on a work transfer or even if you move from one neighborhood to the next, you get your boxes unpacked. Then it’s time for you to find out what’s nearby – what you’re really going to do is build loyal relationships with local businesses that can fulfill your daily, and weekly needs. You’ll need a local dry cleaner, maybe a Thai Restaurant, a Mexican Restaurant, a hardware store and most likely a place to take your family out for a burger.

You receive a new mover package in the mail with amazing offers and gifts to try several local businesses — businesses who believe in their products and services so much that they know you are going to visit and leave satisfied. They also know that you are new to the area and that you now know where they are located. Chances are, because you are not a typical “deal shopper ” you will think of their establishment next time you decide to go out for a burger. Now you are a loyal patron and you are going to continue to come back over-and-over and increase sales for that business over the long term.

With that said, I understand how a shotgun approach such as a coupon or deal may seem inexpensive on the surface, but please consider the differences. A new mover program can help businesses increase loyalty and sales significantly over the long term not just as a “one-time” coupon. We have seen many clients who have been in business for nearly 20 years and have stated that a targeted new mover initiative is the best marketing tool they have ever used. The success of a new mover program can be realized by small locally owned businesses to large national franchise organizations. These business owners also know by targeting new movers, they are reaching a new group of potential loyal customers each month!

Brian Mattingly is CEO and president of Welcomemat ServicesWelcomemat Services provides local businesses access to new loyal customers in their local communities through a combined digital and print marketing program. Unique in the estimated $133 billion local advertising market,Welcomemat Services uses specialized, patent-pending technology to store and log customer demographics for use by the local companies it supports. Welcomemat Services has 12 company owned units and has recently begun offering franchises in several markets throughout the United States. Franchise owners are typically home-based and work with local businesses in their communities.