According to the National Restaurant Association, adults are more likely remember a promotion like From Your Friends (a targeted discount) than they are to remember seeing a newspaper ad, email, online search, daily deal site, or social media post.
Across the country, consumer expenditures on dining out, shopping and entertainment have declined. They need an incentive to get out there and spend money, and a deal that makes them feel they are getting a good value.
In an average year, companies distribute more than 286 billion coupons, worth over 330 billion dollars, which means if you aren't participating, your competition is seeing the results of all that marketing.
In the restaurant industry, the number of discounts being offered is rising faster than most, and not just in the fast food and fast casual areas - high end restaurants are finding ways to offer incentives, too.
And why not? A study by Cornell University showed that redemption rates for restaurant coupons are up to 12 times higher than those for other products. Researchers also found that a customer who used a coupon at a restaurant was 7.5 times more likely to return to that restaurant than someone who paid full price.
And discounts don't always drive down revenue. When diners do use discounts, they regularly spend the savings on additional items such as appetizers, cocktails, wine or dessert.
Most business owners consider discounting more painful than pulling teeth. And while continuous, non-judicious use of discounts can hurt your image and profitability, it's also true that the strategic use of limited-time, targeted incentives can result in a controlled increase of new, quality customers and repeat business.