So, today the team at Network Marketing went for a lovely  lunch  in Leeds using  LivingSocial vouchers.  We  really enjoyed our meal and probably will return  to that particular restaurant because the food was great – on the face of it this may sound like their  marketing promotion has worked perfectly…………..however…

•  When we first booked we hadn’t bought the vouchers and  instead called  the restaurant to see if they would just honour the deal but without the vouchers.  We were thinking that his way the restaurant gets the full revenue and it would save us the hassle of buying and printing off the vouchers.  Unfortunately, the manager didn’t seem to understand and advised us we must buy the vouchers,  even though this way they then have to pay the commission to Living Social (it transpires they only receive half the value of the voucher with Living Social getting the other half).
• When we finished and all said we enjoyed the food we were advised by the manager that we could get another voucher off Groupon – we’d have probably returned as fully paying customers but now will grab this discount!
• The manager has a stake in another restaurant in York which he marketed well to us before again advising of discount codes to get a better deal there – he needn’t have as we’d already been sold the proposition.

 So whilst they managed to recruit 10 new customers for a quick price promotion who will probably return they could quite easily have had the same 10 new customers paying more on their first visit, more on their return visits and more on any visit to there partner restaurant. I know these restaurateurs aren’t trained marketing managers but they must surely have some commercial justification for giving so much away seemingly unnecessarily. I’ve only ever been on the customer end of group buying deals and I appreciate them making food, beauty and travel cheaper but as a marketing strategy are they really used by most in the right manner commercially?     In fact, without a clear  marketing strategy behind them, is there a danger that these voucher schemes could be doing more harm than good to the local retailer?  Tom