Wha’s up with this??

[Fran]

This morning I scanned the AM band and ran into WJQS. They were offering a boatload of 60% discount certificates from a ton of local advertisers. . . . including a $1,000 Bay Point County Club membership for $300. Since I rarely go to the AM band, I have to ask, how long have they been doing this?

They have have a long list of advertisers. I would say nearly half are restaurants, like Mug Shots, Hal and Mal’s, etc. Strangely enough, not many people call. . . my impression is that when you call to buy a coupon they put you on the air.

The show is definitely local. I did not recognize either the lady or guy announcer (don’t recall their names either). I think they offer the discounts for one hour in the morning (I was listening around 9:30).

Discount coupon radio. . . anybody know what’s up with this??

 

[jboyd]

Fran: Oldest scam in the book...the coupon book says it all...go by and look at one and look at the exclusions and conditions...if it is what is normal...you will understand...the seller normally gets the price of the book, and the purchaser gets the...... this is based on past experience, your experience may vary...not responsible if this is an exceptional offer!

 

[Fran]

JBoyd: I remember those coupon books. . . I was never a fan. What WJQS seems to be selling is individual advertiser products/services at a +50% discount. I went to their web site but it really doesn’t explain what the deal is, other than. . . “Start saving 40%, 50%, 60% or even more immediately on LOCAL products and services you buy every day. . . .”

The little I remember hearing this morning was a 50% discount at a hair place, oil change, bowling alley, movie and a number of restaurants. Pick and choose what you want to purchase at half price. Not really sure if you have to be the first caller to receive the discount or if they had stacks of stuff to give away. Like I mentioned earlier, they only had a handful of callers.

What impressed me the most was the number of advertisers that were offering 50% price discounts. I will listen closer tomorrow.

 

[Powerpig56]

It's a "new" way to ad revenue to local radio. Some are doing it exclusively. You go to the merchant, offer $1000 worth of ads for $500 in gift certs and sell them for $250. The merchant gets ROS spots, the station fills unsold time and everyone benefits. Restaurant.com is a similar model but uses the net instead of radio. I was doing this with a LPTV I owned in VA 17 years ago.

 

[Powerpig56]

From the WJQS Website: "You provide us a negotiated budgeted amount of gift certificates weekly on a till further notice basis. We print the certificates for you and provide them to our listeners. We talk up your business on the air, equal the gift certifcate value with on air commercials and provide the website exposure too! All of this, at no cost to you! While you pay other media to print and distribute your coupons and run the commercials, you will never write us a check! Yet, we will guarantee results. Our listeners request your certificates in order to use them. Once inside your place of business, your concern is it upsell the customer, treat 'em well and make them a repeat visitor."

 

[Fran]

I listened again, plus I asked around a little bit too. What JQS is doing has a name, Radio Shopper. They air this feature for a solid hour, once in the morning and once in the afternoon (I have yet to hear them in the afternoon). I am told that they've been doing this for just a few days. . . which probably explains the lack of callers. In the new fall book they are listed as having zero listeners, so this is definitely a “nowhere to go but up deal.”

I started to call this morning and get a couple 50% discount coupons for the Steam Room Grille . . . their Alaskan King Crab is to die for! These days, saving $30 works for me.

I am a fascinated by a station attracting an audience through offering goods at half price, or less. Hard to predict if they will produce spectacular ratings since nothing much ever changes in J. Point of fact, the new fall ’08 ratings again claim that four of the top five stations are urban. Miss, Y and 98 lead the parade of non-urban formats.

IMHO: I think their idea is clever. Just sell stuff for half price and create a threefer. . . audience wins, station wins and advertisers win.

 

[Powerpig56]

Keep in mind that with this format, they don't care about ratings as it doesn't set their ad rate card. As long as they can sell the certs, they're happy.

 

[bobrall]

Jo's Diner on Old Fannin had a flyer about the coupon things a month or so ago.

 

[airwaves1123]

Hey..thanks for posting the Shopping Show info on 1400AM. I wound up buying a Gift Certificate to AJ's Restaurant at half price. Its a great concept. I like their financial programming too. They need to get the word out. Great station. Hope they get a lot more merchants on it. Why pay retail when you don't have to!!!!

 

[jboyd]

Prediction: This is a self fulfilling prophecy.
The more successful it becomes, the faster it will demise.
Figure: The average profit (gross) a restaurant should work for is 30%,
according to national benchmarks.
SO...they give you a 50% discount.
This represents a LOSS on the transaction.
How long until they realize this is a mistake, and no longer honor the cards?
This was the achilles heel of the "other" coupon offers.
NOW...how happy will you be?
"There is no free (or 50% discount) lunch in prepituity"
Sounds like Obama economics to me.
Please shoot me down if you can. JBI

 

[Fran]

Please shoot me down if you can. JBI

I’ll try!

As I understand this (using your math), when a restaurant serves up a $100 meal they expect to earn $30.00. But if I hand them a $50.00 certificate, they wind up losing $20.00. Right? But at the same time they did receive the announcements over the air. . . call that advertising.

The JBoyd Restaurant says, “Certificates? No way.” JBoyd takes the entire $100 and receives a $30 profit. But before the money hits the cash register, a radio sales person comes in and says, “you need to advertise.” Jboyd nods and hands over the $30 to pay for the $50 radio commercial.

Obviously, there are dozens of ways to spin that hypothetical, but the bottom line is that radio advertising isn’t free! No matter if you pay in money or certificates.

What this station should do to create excitement is to promote 50% off on some real high end items. Take a week and plug the heck out of it before offering the certificate. The advertiser would certainly benefit and so would some lucky listener. Who wouldn't jump at a 50% dsicount on something you really wanted?? Who knows folks, maybe they’ve found a new way to make radio run again!

 

[jboyd]

Nice try...but your motivation to buy was the discount. The stations motivation to sell was to get your money...and the advertisers? motivation was based upon poor logic...you don't buy advertising at a loss of revenue. As you said, you can spin it anyway you want...but let's see what happens after a few spins.
This is another ponzi scheme based on the "something for nothing" spin.
Time will tell...and the same logic has cost "believers" Billions! Read the papers
or listen to the radio. Better yet,just wait. It took years for Bernie's scheme
to fall apart...most coupon deals last much less time. There is no free lunch!
Good luck, and negotiate those coupons in a hurry...in financial terms they call it FIFO. ( have a ? See Google). Regards JBI

 

[bobrall]

I have had restaurants refuse to let my station give away discount coupons because
too many of my listeners redeemed them.
What is wrong with selling highly targeted, well crafted commercials to bring in
qualified customers?

 

[Fran]

...you don't buy advertising at a loss of revenue.. .

Not really sure what that means. . . I think that you are confused by the word "coupon". . . forget "coupon" and insert the word "sale" or if you prefer, "discount." In case you haven't heard, the economy isn't doing real good right now, so it is possible that the term "sale" and "discount" will be with us for a while.

 

[knowsthings123]

There is a suburban Chicago station (WRMN) that has been doing the Radio Shopping Show for 26 years! Las Vegas (KSHP) for over a dozen years... sounds like it has staying power.

 

[Powerpig56]

Hey..thanks for posting the Shopping Show info on 1400AM. I wound up buying a Gift Certificate to AJ's Restaurant at half price. Its a great concept. I like their financial programming too. They need to get the word out. Great station. Hope they get a lot more merchants on it. Why pay retail when you don't have to!!!!

So, what do you do at the station?

 

[airwaves1123]

jboyd - no offense, but you are ignorant. When I was in retail, I loved to give out gift certificates to potential customers. You obviously provide the public a reasonable amount of certificates, expiration dates and carefully control your cash inventory in order to keep your business from being overwhelmed with discounts. That process brought in new folks who usually turned into cash paying repeat customers. They also (I was in the restaurant business) brought in other couples with them who may or may not have had plans to come yet spent cash. All consumers need a "hook" or reason to support a retailer. If a discount gets them into the door and, as the operator, you treat them well, they might become a long-time repeat customer. I have been listening to 1400 and their concept is awesome. I would suppose the advertiser receives the on-air promotion in exchange for allowing the station to sell, at a discount, their gift certificates. Sounds to me lie everyone wins. I think they've got a winner on their hands.

 

[oldiesstation]

No offense Airwaves,but could you be more polite in your description of jboyd.??I assure you he is not Ignorant., .Maybe he does not fully understand the concept.Years ago i did one of these coupon book deals and it was a rip off.Now maybe this is a new and improved version.But calling him ignorant is not very respectful.thanks

 

[Fran]

"...Maybe he does not fully understand the concept.. . . "

Actually, I likely misled JByrd in my first post by calling it “discount coupon radio.” My bad. What they are doing is a radio version of the Home Shopping Network. They parade a product out on the stage and then offer it at a savings. Interactive commercial advertising is the way of the future.

The concept is certainly simple. Patty Peck offers a $30 oil change for $15. . . Patty gets 100 customers on the lot with 100 new chances to sell a Honda. The restaurant offers $15 off on a $30 meal, but then sells a few rounds of drinks. You’re driving along and hear that Papa John’s is offering a $10 certificate on a $20 pizza. . . you grab your cell phone. Next thing you know you’re adding buffalo wings and cinnamon sticks to your order. If you are not in the mood for Pizza, you are still exposed to the advertising.

Nevertheless, I have to ask, why not just run an add that says drop by and receive a 40% discount? Perhaps it is the psychology of having to do it now is what is at play. I’m not sure, but I do believe that the days of playing three commercials back-to-back has seen its better days.

 

[knowsthings123]

This are NOT coupon books.... forget that. The station sells gift certificates to restaurants, stores, and services. Gift Certificates just like you would buy to give to somebody as a gift - the only difference is that the station sells the certificates for a lot less than the face value. It's a great on-going promotion. A no-brainer for retailers. The station licenses the system and actually prints out the gift certificates - NOT coupons. This is like "magic money." $20 gets you $40 worth of stuff. Check out www.KSHP.com and see what they're doing.