Are Daily Deals Right For Your Restaurant?

 In Industry Trends Blog Archives, Marketing

Groupon has been around since 2008, so by now you’re probably familiar with how it and other daily deals sites (such as LivingSocial) work. Your restaurant offers a great deal, such as $30 worth of food for $15, and customers are able to redeem the deal in your restaurant within a certain time frame. You can get tons more customers and a boost in awareness. It sounds like a great idea, right? Well, not necessarily. Just like most decisions you make about your restaurant, there are definite pros and cons to offering daily deals. Read on to find out if daily deals are for you.

First, the pros. Although daily deals might get some bad press, they can actually offer quite a few benefits to your restaurant.


With daily deals you can get a ton of awareness for your restaurant, without investing in a costly marketing campaign. This can be especially great if you’re a new restaurant and you want to introduce yourself to the neighborhood.

Short-term profits.

There’s no denying that daily deals can be a great way to make a lot of money in a short period of time. Typically, your deal will only run for a short period of time (weeks or months) and, if you plan correctly, a sharp spike in traffic can really help your restaurant out during a slow season.

Repeat business…if your quality is high.

It’s also important to remember to keep the quality of your food and service high while running a deal. If you impress the customers that come in, there’s a chance you can turn them into regulars.

But what about the cons?

A huge spike in customers.

This sounds like a pro, right? Not always. Yes, you get a huge traffic spike during a short period of time, but this isn’t all good. Many restaurants aren’t prepared for a large increase in customers and they’re unable to give customers the quality of food and service they usually provide. If a customer who uses a daily deal at your restaurant has a bad experience, they won’t be back, which doesn’t help you at all.

Bargain hunters.

It’s important to keep in mind who, exactly, you’re attracting when you offer a daily deal. Are the customers who are coming in the type of people who will be back again to pay full price, or are they just frequent users of the daily deal site who are looking for a bargain? If it’s the latter, you’re not helping your restaurant much by giving them a deal.

Lost profits.

Frankly, there’s a decent chance you’ll actually lose money with a daily deal. How? Well, think about the discount you’re offering. It’s probably pretty significant. If you’re giving away a $30 meal for $10, that means you’re losing out on $20…times however many customers purchased the deal. Ouch. Some restaurants have even complained that Groupon takes too long to pay them the money they’re owed.

Cheapened brand.

Offering a daily deal once is one thing. But if you offer deals multiple times a year, what are you showing your customers? That your food isn’t worth full price! If customers know you’re just going to offer another deal soon, they won’t bother to come in on a regular day.

Only you can decide if daily deals are the right choice for your restaurant, but it’s important to keep all of the facts in mind. By considering these points, you’ll know whether or not daily deals make sense for you!

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