Marketing With Coupons? Don't Hold Back

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I received this email asking for my retail advice...

Dear Bob,

This past Tuesday, my husband and I took our car in to a dealer near Mission Viejo for a routine oil change, a front headlight replacement and to check the brakes. We've gone to this dealer for the past 6 years, but they'd recently changed ownership. We always had good experiences in the past, so we were hoping for a good experience this time.

Turns out we did need brakes and a brake fluid change, so that brought our original estimate of $94 to the final total of $608.

Just two days after that service, I received coupons in my email from the dealer. I could have saved $40 with those coupons! I called the dealership and after the phone continued to ring unanswered, my husband and I decided to go in and ask them to credit the $40.We spotted the service guy who normally helps us and told him what we wanted.

He said, ‘I can't do anything about it.’ Hubby says, ‘We want to see the service manager.’

Service guy says, ‘Just talk to so and so since he wrote it up. There isn't any need to talk to the manager.’

So and so says, ‘I can't do anything about that’ (Oh, that just escalated my boiling point right there.) I said, 'Then call the manager. This is ridiculous.’

He went to talk to the manager, came back and said, ‘$20 credit on future servicing is all he'll do. You can only use one coupon. With the new management, we're following all the rules.’

I replied, ‘You are telling me, as a 6 year LOYAL customer, that I am not worth saving for an additional $20? Forget it. We're done. We won't be coming back and we SURE won't purchase another car here.’ And with that, we left.

Within 2 hours, we received a call saying that we would get a $40 credit towards a future servicing. However, I don't feel warm and fuzzy about the dealership.

Just goes to show that you can really damage a good thing over something that, in the scheme of things, was very little. I'm sure you hear this all the time. If only these companies would get a clue.” - Dian

My Take
What struck me first about this story was that she was talking about 6% of the total order being refunded. You can bet their cost of acquiring a new customer is probably five or more fold.

As longtime readers of my blog know, I am not a fan of couponing. I think it often causes problems – usually in regards to loyal customers.

BUT if you’re going to offer them, if you made the decision to give away money to people who will use them, then darnit, don’t pull back from honoring your coupons! You aren’t losing anything!

Jeez, from Dian’s story you’d think she was asking them to give the store away when in actuality, it was less than the tax on the total bill.

Secondly, if you have a CYA culture that is disempowered you will get customers railing against you on Yelp, Twitter, Facebook, LinkedIn, YouTube – even blogs.

Couple that with Analytical personalities who only see black and white and you have a recipe for disappointing many customers as they follow the letter of the law.

What’s particularly ridiculous is their offer of $40 in future service. Heck, they should have refunded the $40 and given ‘em the $40 towards future service in a personal phone call from the manager or new owner. A bonus would have been a gas card to pay for their trouble to come in in the first place because no on answered the phone.

Instead Dian has told me and I’ve now told thousands of you her story.

What say you coupon marketers? Was Dian being unreasonable? Should coupons be absolutely verboten on previous purchases? And how does that compare to your local Macy’s, Nordstrom or Best Buy?

Don’t make the same mistakes your competitors do when hiring; take my retail advice and learn about the four personalities in my book, The Retail Doctor’s Guide to Growing Your Business.