23 Nov 2014 | Digital editions, magazines, websites, e-zines, handbooks and contract publishing for the leisure industry

Leisure Opportunities issue 645, 2014 is now out!


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Health Club Management

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Chief Executive,
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Customer Relationship Director,

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Fundraising and Events Manager,

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Philippe Rossiter
Chief Executive,
Institute of Hospitality

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To coupon or not to coupon

10 Feb 2012
by Eva McDiarmid, Chief Executive, ASVA
In one deal, a 5 star hotel was offering a day at their spa for a whopping 67 per cent discount - but the reality was specially created 'dumbed down' days

The growth of the phenomenon known in the US as 'e-couponing' appears to have no limits.

If your inbox is anything like mine, the number of intermediaries offering discounting 'deals' increases by the day, so you'd conclude that there must be money to be made.

The idea of coupons is not new. Unsurprisingly, the first coupons were offered by Coca Cola way back in 1887, when paper tickets or coupons featured in magazines or were handed out by sales reps to be redeemed for free drinks.

The company gave free syrup to stores with soda fountains and by 1895, they were able to state that Coca Cola was served in every state in the US. (Interestingly at that time, cocaine was still one of the ingredients and which wasn't removed until 1903, so hardly surprising that it retained a loyal following!)

The key difference in couponing now is that it is being used increasingly to promote services - restaurants, beauty treatments, activities, overnight stays and more... The timing is of course not purely coincidental and dovetails, in the current economic downturn, with the need to save money.

Advocates say that the one key advantage coupons offer is that their usage can be tracked so you can measure their success as a promotional tool. But as one who has used coupons my experience of how they are used is mixed. I am not always sure that the organisation offering the deal is leveraging the maximum benefit.

In one deal, a 5 star hotel was offering a day at their spa to include unlimited use of the facilities, soup and sandwich lunch and an hour's massage - all for whopping 67 per cent discount.

The reality was specially created 'dumbed down' days. On the day we were there, no one seemed to think this was in any way reflective of 5 stars, so the experience on the day fell far short of the expectation. And crucially the hotel made no attempt at trying to engage us in the future either by email or even by another more considered offer.

A restaurant which shortly after it opened barely two years ago was Trip Advisor's #1 in Glasgow, has now rather ignominiously dropped to somewhere in the 150s. It has gone down the discount coupon route and although the two things may not be linked, the adverse reviews are about the service (or lack of it) and the lack of attention to detail, and not about the food itself. Again there is a mis-match between the experience and the expectation.

'Back in the day' as the current phrase goes, if I needed to return any sale goods because they had developed a fault, I always asked the assistant if 'sale' goods were sub-standard. The answer of course was always 'no' (unless clearly stated). It was always easier to negotiate an exchange or refund after that! And so it is with services - a discount is an introduction to encourage new business. Compromise on the service and the purpose is lost.

In the US it is estimated that 25 per cent of all marketers are investing in SMS and digital coupons so the phenomenon is here for the foreseeable future. Like everything else in each element of the marketing mix, it is one component. Alone, it will not deliver a new audience but equally it cannot be the weak link and must always deliver the experience promised. Who said that life was easy?

Tags: hotels & hospitality  tourism  visitor attractions  sales & marketing 

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