Business Monday

Those Bed, Bath & Beyond coupons wow consumers — but they’re crushing the company: Opinion

Miami, Florida, August 21, 2015Adam Snitzer
Miami, Florida, August 21, 2015Adam Snitzer

Nothing much good comes in the regular mail these days.

A few bills and official notices from companies I haven’t gone paperless with. Announcements of houses for sale or recently sold. People running for office. Solicitations. A couple of catalogs. Once in a while a huge, glossy magazine I never subscribed to.

You’d think I’d just toss it all. But I don’t. I cull through it carefully because every once in a while, there’s a golden ticket: the famous, coveted and often hoarded Bed Bath & Beyond 20% Off Entire Purchase coupon.

“It’s the best coupon you can get, possibly in the world,” according to award winning actress Kristen Bell, who declared her obsession with Bed Bath & Beyond coupons during an interview with talk show host Conan O’Brien.

The studio audience erupted in applause. Because they too, like Kristen and me, stockpile the golden ticket.

Twenty percent off anything you buy, and in rare and special cases 20% off everything you buy, is almost too good to be true, right?

I’m afraid so. From a marketing and pricing standpoint, Bed Bath & Beyond’s coupon strategy is downright reckless.

Well-schooled marketers know that a discounting strategy should be carefully aimed in order to stimulate incremental sales without giving away the store.

That means targeting a narrow consumer segment that’s underperforming sales expectations. Or pushing a specific group of products that are languishing on the shelves. Or stimulating a limited time of year when store traffic needs a boost.

And sensible discounts should have strict terms, conditions and expiration dates.

But Bed Bath & Beyond has flouted all these rules.

Narrow targeting? Nope. Their coupons are widely available. People get them in the mail, or in magazines, or online. A recent Google search returned dozens of sites where you can download the company’s coupons.

Limited to slow-moving products? Nope. Bed Bath & Beyond coupons are applicable to virtually anything a customer wants to buy.

Time sensitive? Nope. While Bed Bath & Beyond coupons have an expiration date, it’s not enforced. Their discounts are good forever.

Strict terms and conditions? Nope. Bed Bath & Beyond allows customers to combine its coupons with manufacturers’ rebates and is willing to add them on top of other markdowns, even semi-annual clearance items that are already marked down by 50% or more.

Forgot your coupons? Don’t worry. You can come back later with coupons in hand. Just show your receipt and you’ll get a refund.

Amazingly, they’ll even accept coupons from other stores.

It’s hard to imagine a more customer-friendly set of policies. But it’s also hard to imagine a worse discounting strategy.

While many retailers are buckling under pressure from the likes of Amazon, Bed Bath & Beyond’s problems are self-inflicted from their far too loose couponing strategy. The results have been a disaster.

Since 2015, the company’s stock has fallen from $77.91 to $9.67, a decline of 87% at a time when the overall stock market is up more than 50%.

It’s no wonder that investors aren’t happy and recently forced the company to replace five board members, including the CEO and two co-founders.

The company hopes that closing dozens of the least profitable stores, redesigning the remaining stores and better customer analytics will save the day ... but if Bed Bath & Beyond doesn’t get smart with its couponing strategy, its days are numbered.

So, if you’re one of the many Bed Bath & Beyond coupon hoarders out there, you’d better redeem them before it’s too late. Who knows? Those golden tickets may really have an expiration date after all.

Adam Snitzer is a revenue strategy expert and president of Peak Revenue Performance, a consulting firm that specializes in helping companies attract more, high-paying customers. He can be reached at adam@peakrevenueperformance.com.
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