Vouchers: Short-term fix or long-term strategy

Discount vouchers have been dominating the minds of marketers for restaurant chains in every major city in the UK. Everyone seems to be offering 2-1 discounts, to the point where a significant percentage of the target audience won’t eat anywhere that isn’t providing a voucher.

In the short-term, vouchers appear to be a competitive necessity – particularly for the lunchtime crowds. But if you aren’t careful, you are going to find yourself in a spiral of decreasing value, with no way of reversing the trend.

On the plus side, the vouchers are driving people in to restaurants, and tempting new customers into the door for the first time.

But on the downside, the obsession with discounting is devaluing restaurants and brands, reducing differentiation and stopping chains selling what they are famous for.

This dichotomy is epitomised by the situation at Pizza Express. The astonishingly successful seeding of their vouchers has opened up the restaurant to a new audience that previously would have been the preserve of Pizza Hut and Dominos. But at the same time, much of its traditional audience won’t eat there now UNLESS they are getting a discount.

So how can you stop yourself getting into a similar situation?

The first thing to do is to change the way you look at the voucher process: although you are asking customers to make a decision based on economics, it is an opportunity to engage with your audience.

The second thing is to change the way customers look at the voucher – by making them do something to earn it. No matter what mechanic you’re using (come at certain times, bring the voucher in whenever you like, personalise your voucher, buy specific product,) – if they don’t have to do anything to enjoy the discount, customers won’t value it once they’ve got it.

By following this approach, you will learn more about your customers through each interaction they have with you. This makes the voucher part of the journey – once somebody has signed up, you can use the voucher mechanism to introduce them to the products or experience the brand is famous for, and to start them off on the journey to become a brand advocate.

Vouchers are incredibly powerful. Done well, they not only drive footfall, but can put your brand at the front of the customer’s mind. But if it’s just short-term activity outside of your overall communications strategy, you’re not only missing an opportunity to create a valuable relationship, but you may find yourself in a discount war with no exit strategy.