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Optimizing Couponing Strategy

The Challenge

A national casual-dine chain asked

  • What is the impact of our current couponing strategy and how do we reduce our discounting without negatively impacting visits and revenue?

The Solution

The client combined Promotions Manager (Fishbowl’s tool to optimize, distribute, and track promotions) with Guest Analytics to evaluate coupon use among guests and to look for opportunities to increase their effectiveness. Guest Analytics was leveraged to evaluate coupon use among guests and to look for opportunities to increase their effectiveness. Guests were broken into 3 groups:

  • High-use couponers – those who used a coupon with each visit
  • Mixed-use couponers – those who visited with and without using a coupon
  • Non-couponers – those who never used a coupon

couponers

The client tested different coupon strategies in each segment including:

  • High-use – Lower coupon values ($ and %) and increased purchase requirements
  • Mixed-use – Increased number of value-add messages, along with, lower coupon values when coupons were presented
  • Non-use – Coupon messages replaced with other value-add messages (take out, date night, other events)

The Results

Lowering the discount to heavy-use couponers resulted in an annual savings of $506,000 and specific targeting for the mixed and non-use segments drove $585,000 in incremental annual revenue.

Moving forward

Data-driven insights for each segment continue to define the restaurant’s coupon strategy. They use targeted messages to drive visits and sales in each segment and monitor the effectiveness of the campaigns with a number of tools in Fishbowl’s platform.

Download the .pdf version of this case study.