THE THINK TANK
Experienced operators discuss the
coupon offers that work and the
ones that hurt your bottom line.
Padrones Pizza East: Do any of you use coupons and, if so, what kind of percentage discount do you offer?
brad randall: We call our bundle the Crazy Aver’s Deal.
It used to be called the Crazy 8 Deal back when our
competitor called theirs the Big 10 Bargain. Ours was
$8, and theirs was $10. Pretty clever, except inflation
makes sticking to a price di;cult. ;e Crazy Aver’s Deal
is $12.99 with no mention of the price in the name. So
my suggestion from experience is to not tie yourself to
or brand your deal with a price. Set a discount/price you
can live with and raise it a little bit every year.
Royster 13: More aggressive marketing can sometimes
work better than coupons. If you’re doing $1,000 a day
in gross sales but giving away $150 to $200 in coupons,
you only net $800 to $850. But if you spend some of that
loss from coupons on more marketing each day, you may
increase your net profit. However, all marketing requires
testing and tweaking until you find the “sweet spot.”
bodegahwy: We don’t o;er coupons with a percentage
discount. We have three types of coupons: 1) Value
added—order this and get that for free or half-price, such
as buy a 16” pizza and get a free pint of ice cream; 2) set
discount—save $5 when you order two 16” pizzas; or 3)
promotional price—buy a 14” pizza with one topping
Stop thinking of coupons as money you give away.
;ey aren’t. If you’re going to use coupons (and there’s a
good reason why most pizza places do), you need to build
the o;er into your price structure. ;en start looking at
whom they attract and what they produce.
Freddy_Krugerrand: We run coupons, but they are only
good Sunday through ;ursday. ;is way, we can o;er
more aggressive deals during slower days and not worry
about coupon users taking up valuable table space on
Friday and Saturday.
Warren: I agree with bodegahwy that coupons need to
be built into your pricing structure. ;e real downside
of coupons lies with people who would have paid $14.99
for a large pepperoni but buy it with a coupon for $9.99
instead. ;at’s why having a POS system—and being able
to direct-mail to your customer database by last date of
order—is so important. If Tommy orders a large pepperoni for $14.99 once a month, you can mail him a coupon
for a free order of cheese bread or a two-liter drink if he
orders in the next week. ;is gets an extra order from
him at a high margin. If Suzie orders once every three
months, you can a;ord to o;er her a better deal to get
her to order once a month.
Get answers to your most perplexing problems and swap tips
and ideas with the experts in PMQ’s ;ink Tank, the pizza
industry’s oldest and most popular online forum. Register for
free at thinktank.pmq.com. (Member posts have been edited
here for clarity.)