Why You Never Want To Use Voucher Companies If You Are Looking To Attract New Customers To Your Restaurant – (and what you can do instead that will actually work for you – like a tap that you can just turn on and off!)
The typical Voucher Company scenario:
Many small and medium sized operations involved in local service businesses, such as restaurants have used one or many of the voucher companies.
It’s an appealing sales pitch:
We don’t charge you anything until you make a sale. We bring brand new clients into your business. We need a super good offer (preferably big ticket with a big discount to get them in), but then they’ll keep coming back and your business will grow and grow and remember, you only pay us when people are taking up the offer – so what is there to lose!
Well, in some cases your entire business! Let’s look at how this works:
The real customers of the voucher companies are the customers who they are bringing in to your business to receive the big discounts.
Let’s be very clear – YOU ARE NOT THEIR CUSTOMER! They encourage you to come up with a huge offer, which when you look on their websites you will see is usually not a discount on businesses lower priced services but more often than not a huge discount on their medium to higher priced services.
They market your offer to their customers (voucher junkies who are often willing to travel some distance to claim a big discount) who are conditioned to shop on vouchers.
Then once your offer is over that same customer will get other similar offers from other similar providers marketed to them by this same voucher company.
So at the end of the day:
- You are providing your service to voucher junkies, are they likely to want to continue to come to your business?
Only if you keep offering massive discounts – because that is what the have been conditioned to receive and that’s how most of them will now view your establishment – they’ll expect a discount next time they visit!
- Are you providing your service to mainly local customers, who if they like your service will likely return?
Usually not as they have often travelled some distance – they are not your typical customers, they are voucher junkies after a big discount!
- Are you making money from the initial offering?
Usually not. You have heavily discounted one of your great meals (or your entire menu) and you are then paying the voucher company a percentage of that discounted price. You’ve discounted away your entire profit!
Voucher companies are great for their customers, only problem is that you as the service provider are NOT THEIR CUSTOMERS.
Now for the right way to entice a customer in the door!
- Who do you want to target?
Usually only local customers. You want to look at your current customers, (the good ones) and ensure that you are targeting others from their same area, age group etc – you want to target more of the demographic that you have now. You want more of the type of customer that you are making money from now!
Or perhaps your key target are tourists, well that’s fine too, it works in the same way, work out who they are and then put a strategy together that targets them specifically.
- How do you want to target them?
You don’t want to target them via a voucher company as that way you are attracting the sort of people that are always shopping for a discount. You want the people who will be willing to pay your standard prices, once they know you and appreciate how good your service is. So you want to target people locally. You also don’t want your customer comparing your restaurant (and your offer) to other similar offers from other similar restaurants, so you do not want them going to a website where you are just one of many!
- What do you want to offer them?
Well, you can offer nothing, just tell people how good your restaurant is, the food, the service etc and remind them of who you are and that you are local etc. That will work to a very limited degree and is certainly not a bad start if you are a new restaurant in the area, as no-one is going to visit if they do not even now you exist, so some awareness type campaigns can be a good idea.
But the reality is that you will usually need to offer customers something special to get them in the door the first time. You might know that you have the best food and the best service – but they don’t, so you need something to entice them in,
but you don’t want to give away all your profit!
Offer them a substantial saving on something that many of your customers love, something that is fairly low cost to you, but it will entice them to come in and try you out. So it must be something substantial from their point of view, but not something that costs you much and something that still leaves plenty of room for them to buy more. As an example, perhaps offer them a free cocktail with any main, rather than just a total discount off the entire meal as the ‘free cocktail’ sounds better and you’ll make more money!
Here’s how we do it:
We start by looking at what the restaurant has to offer, what are their key meals & drinks, who are their ideal customers (age, location etc) and what is something that this group will have a big interest in.
We then set up a Facebook advertising campaign to target the key demographic and making them an offer that is a great “deal” for them, gets them in the door, but does not cost the business too much.
Important to note:
- We are only putting this offer in front of the people who we want to target, age, gender, location, perhaps interests etc. So we are only paying to advertise to our target audience.
- We are pushing the offer out to them, so we are not attracting those who are searching for offers.
- It’s your company putting the offer out, so you are not taking people back to a website with all your competitors and their offers.
- You are collecting data on your new customers (not the voucher company) so you are building a local database of people who you can also target later on, whether they come in for the current offer or not.