2011 December: Man on the Street

It’s great when your phone is ringing off the hook, but I have a feeling your heart sinks every time the voice on the other end offers to “feature” you on their daily deal Web site. If you haven’t received one of these calls, it’s only a matter of time before you do. The basic gist is that the site offers an amazing coupon for your business — usually 50 percent off — to thousands of subscribers. You get plastered on their site for a day or two, and everyone on their email list is forced to read the name of your business (unless they click delete). There are no upfront costs; you just have to split the remaining 50 percent with the deal site.

I had the opportunity to work with one of the biggest group buying companies a couple years ago, just as they launched their site in New York. We did a big discount on my walking NYC Pizza Tour, and I had no idea what to expect. Daily deal sites were still pretty new at that time, so it was unchartered territory for me.
Sure, people were paying half price and I was only getting part of the remainder, but the influx of new customers was incredibly valuable — or so I thought. Most of the buyers had either never heard of my business or never cared enough to purchase a ticket.

The best part about my deal was that most of the new customers were local — and you know how powerful local clientele can be. If they like your business they’ll tell their friends, bring family members, write online reviews and help steady your customer flow. I’ve even had some customers who signed up for a tour after seeing it listed on the past deals page of the deal site. All in all, the deal ran pretty smoothly.

Now for the bad news. As soon as I ran my deal, scores of other companies started calling to offer similar “features” on their Web sites. Of course I didn’t want to run too many deals as I did not want to run the risk of devaluing my product. I also had to consider the chance that bargain shoppers could take up all the space on my tour, preventing full-price customers from signing up. From your point of view as a pizzeria owner, the last thing you want in your restaurant is for your tables to be filled with coupon-toting diners while your regular customers wait outside in the cold.

The way I see it is that it’s dangerous terrain, to be sure, but you can make it work if you navigate carefully. When preparing your deal, be sure to schedule it right before your slow season so you can attract new crowds when you need them the most. Lots of businesses complain about daily deal sites because they have been burned as a result of improper deal management. Don’t fall into this trap; plan your deal intelligently and train your staff to deal with the influx of new customers.
Once I walk into your restaurant with my daily deal coupon, it’s your job to convert me into a lifetime customer. Make sure I know about your mailing list, Facebook page, Twitter feed and Web sites so I can stay in the loop. You can even use the daily deal model on a micro level to feature one of your under-performing menu items for half price during a slow lunch. If you win me over, I’ll probably jump at the chance to stay connected to your business — even for full price.

Scott Wiener owns and operates Scott’s Pizza Tours in New York City.

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