Although more establishments are taking advantage of daily-deal programs such as Groupon and LivingSocial, many firms — and their employees — later regret the experience. Failure to manage these promotions properly can destroy their value. Before you run an online promotion, ask yourself these questions:
Questions to ask before you run an online promotion
- What are the short-term and long-term benefits of this promotion? How does it fit into your overall marketing plan? Are you prepared to lose money on the deal short term to capture a long-term customer?
- How will you staff around the promotion? A few days after the promotion hits, expect a mass influx of customers. Business may also peak in the last days of the promotion as people scramble to cash in coupons.
- How do you position the promotion to your team? Why should they get on board with it? What's in it for them? If you're running a restaurant, how will you prepare employees to deal with more business and unfamiliar, possibly annoying customers? Will you help with additional staffing or pay overtime? Anticipate employees' concerns and resistance before you launch the promotion, and involve them in ideas that can make it a success.
- What training will you provide so the promotion goes according to plan? For example, when a restaurant customer presents a server with a Groupon coupon, will the server smile because they see a new customer, or frown because they expect a poor tip? Train servers to open a positive conversation, collect useful customer information, and attach a simple "cheat sheet" to the coupon so you can track whether the visitor is a new customer.
- How will you help customers recognize that wait staff live on tips or salespeople on commission? Many coupon customers calculate tips from the discounted price, so consider showing a recommended tip on the bill (for example, 15% or 20% of a normal bill) to guide customers.
- Plan to get feedback from your staff right away and be ready to make changes on the fly so you're on top of managing the promotion.
- Know how you'll end the coupon customer's experience. At the end of the visit, employees can ask for an email or phone number to send future specials, offer to enter a business card into the system, or provide a sign-up card. If you're running a restaurant, add a notice on the menu or bill inviting customers to sign up for regular notifications.
Promotions are great when planned well. The right ones can help grow a business quickly — and harm it quickly if mismanaged. Make sure to plan promotions carefully and include your entire team in the process.
Frequently Asked Questions
Will daily-deal customers become repeat customers?
Some will, but conversion depends on the quality of the experience and how well you capture contact information to follow up with targeted offers.
How should I prepare staff for a promotion?
Provide clear training on greeting coupon customers, collecting data, handling higher volume, and any compensation or overtime arrangements before the promotion starts.
What’s the best way to collect customer information during redemption?
Use a short sign-up card or a quick server script to ask for an email or phone number and note whether the guest is a first-time visitor.
How can I reduce the risk of low tips or commission-based conflicts?
Educate customers with a suggested-tip line on the bill and communicate with staff about fair handling of coupons and expected service standards.