New twist on Michaels Coupon

[j Paul]

Looking at the Sunday paper today and saw Michaels has added a new twist to their coupon, at least this is the first time I have seen it used here. Instead of the 50% OFF your entire framing order they now are trying:

$50.00 Off any $100.00-199.00 custom framing order

$100.00 Off any $200.00-299.00 custom framing order

$150.00 Off custom framing order $300.00 or more


Why buy a job for $150.00 and save $50.00 when you can do a $200.00 order and only spend the same $100.00

Of course the people that spend more than $300.00 on a single order get screwed because they are only going to get a maximum of $150.00 Off now, instead of 50% of their entire order.

For whatever it is worth, just thought I would post their new tatic here in Toledo, Ohio.

Are they doing this else where?
What do you think of this?

 

[JRB]

That's show biz. It makes sense for Michaels, not so much for their customers. It is however, a discount that many people will jump at. It also is in concrete dollars, not percentages. Believe it or not, a lot of people do not register a fifty percent discount in their heads, but a fifty DOLLAR savings hit's em between the eyes, just jumps out at them. I would say that someone in Michaels advertising and promotions department is thinking.

John

 

[Baer Charlton]

J Paul

Is that the coupon that they run here in Portland, OR: Check out about the second line of the tiny print..... curious statement: "Not valid on special orders"......

What part of "custom" was NOT "Special" . . .

As the lawyer always says: "What the Big Letters Givith, the little letters takith away."

It's all on the premis that if they drag it down there and into the back of the store, when they find out the great deal is no deal at all, they will do it anyway. Guess it works. But I do know, I don't think I would want most of their customers anyway.

baer

 

[j Paul]

Baer, It doesn't say not available on special order, but of course it does say that it can not be combined with other coupons. Also that it can not be used at Micheals.com. So I guess their online orders must be priced different than their stores IE: not jacked up! so high that they can afford to mark them down 50%

I'm not worried at all about Michaels, they do make people aware of Custom Framing. Our new store will be opening in mid-July. It will be interesting.

 

[j Paul]

JRB Know what you mean about peoples perception. You always see the sales that say "buy one at regular price, get second at half price" Guess that sound better than 25% off! Plus they sell two instead of one.

Who was it that sang the song: The Games People Play?

 

[Bob Carter]

Which one do you think will be more successful, the old tried and true, or this new promotion?

You can bet they tested the concept before this launch and now they will monitor it to see if it can be validated.

Which one would drag you in?

This one should yield higher margins.

 

[Baer Charlton]

Michael's is the proud owner of an interesting set of stores called Aaron Brother's.
I cut my eye teeth in Los Angeles where they started and was friends with Len and his 600 suits and 2,000 shoes, and 400 hats. Great character.... anyway I digress....
Aaron Bro's came up with "buy one, and the second of equal or lesser value for just a penny". They ran the promotion 6 times a year. And every college student, young couple, and young mom could tell you when the last ran, and when the next would hit. BUT, they still did plenty of business during those other 6 months of the year.
Secret 3-400% mark-up of the frames.... duh!
Then they applied it to "same thing for custom FRAMING", notice "Framing" not "Frame", the frame was regular price the sale was on the mat, backing, glass, hooks, wire, labor, dust cover, glazing points, tape . . . . everything was itemized, EVERYTHING then discounted on the second one...... Everyone focused on the "Savings" and noone notice the cost of the custom frame was double over anywhere else in the city. It was amazing. But, then, somebody had to pay for that Radio Mobile Telephone in Lens car in 1970.....

Honest.....hmmmmmm. Legal, yes. Moral.......hmmmm.
We'll discuss this again in Nov.

baer

 

[JRB]

Baer, when did you work for Aaron Bros.? I worked directly for Len Aaron from 1964 until May of 1976. I still see him at least a couple of times a year. He was my mentor in this industry, a real character but smart as a whip. He would be disarming in the way he handled people, but he never missed anything. He could go into any outlying store and know at least half the crews first names. When he left, he would know them all. Sitting in his den like office at 960 N. La Brea, he could give you the monthly figures for any store in the chain, off the top of his head, without hesitation. He is 86 years old now, still sharp as a tack. I would not trade my years working for him for anything, great education, great memories.

John

 

[tjay]

They're running the same ad in the St. Louis area. It makes sense to me in that it doesn't provide a discount for the customers who are determined to pay less than $50... even if that means a paper mat & set of thumbtacks.

 

[JFeig]

Interesting thought.....
If you have a 60.00 job times 2 (120.00) will that qualify you for the $50.00 off?

 

[Jim Miller]

The same ad appeared in the 'Columbus Dispatch' for the first time this weekend. This next step really isn't a surprise, but where do they go from here?

The BigBox mass marketers must have known all along that their deep discounts create a slippery slope for profitability. Nowadays, few consumers would be stupid enough to go into one of those places without a discount coupon, and 25%, 30%, and 40% discounts are no longer attractive. Consumers have learned to wait for the benchmark 50% discount coupon to come out again.

I think you are right; the dollars-off promotion should be more effective than their old percentage discounts, at least for a while. It's new, and not quite as damaging as the percentage discounts. But if this is Michaels' idea of a way out of the deep discount rut, I'm afraid they're only digging themselves in deeper.

These folks know what they're doing -- no doubt about that. So far, their strategy has worked very well. They've captured at least a third of the framing market. Consumers have been conditioned to believe the best frame is the cheapest frame. Frame shopping for many of our former clients has become a quest for the cheapest frame; they now focus on price more than quality, which is very good for the BigBoxes. Consumers now perceive custom framing as a commodity, instead of the hand-crafted specialty we have always claimed so proudly. I'm sure those have been prime objectives of BigBox marketing. Mission accomplished, so far.

But their present advantage will diminish over time, and they will eventually have to come up with another, and yet another knock-out attraction. Where do their huge retail markups and the silly discounts end? 80% off? $500 off a $1000 order?

 

[Baer Charlton]

A lady was in on Saturday, and has framed a few things with us before. (I love that POS computer that remembers our customers and their past orders, cause the mind is going).

She delicately was hinting around for a discount for framing if she brought "all 7 of her things in and did them at the same time".

I pointed out that the 7 pieces would all take time to design, would be 5-7 different frames, 7-20 different mats or combinations, would be 7 different mountings that could range from dry to sew-down to museum float, and could be different glasses even. But if they were all the same exact size photo with same honked out mat and frame for uniformity . . . then we can talk. But when you ask for a custom design work, then custom attention to details, where was the criteria for a non-custom pricing. She saw my point and then said, well, I'll just call and arrange a time to bring them in and do them all at once anyway.
I then made her happy by offering: "In a case like that, it helps you and us, for you to have an idea where they are going, and how you would like them done, and what kind of budget we have to work with, to accomplish your goals and obtain the best framing with-in that budget.

That is a major area that Michael's and the other big-box mega-buckers can never understand or be able to offer, and still keep on track for "keep the shelves stocked, get their money, move them out the door."

Educator, problem solver, helper, friend. But how do we put that on our sign over the door.

baer

 

[Jay H]

Put a big sign out front that sais "ROOFER" they pretty well cover everything!

 

[Emibub]

I thought the advertising for the sale posted in the store looked confusing. Plus, this explains why recently they added some defaults to their pricing software. As an example, their computer now automatically defaults to charge for spacers on each and every order. Just in time to offset the new advertising campaign. Hmmmmm.......customer won't be any wiser.

This new approach is definitely a result of their 50% off no longer having an impact.

Have they really taken a third of our business? It seems to me that they have reduced the level of framing and made it more accessible and have created a base of customers that never would have considered framing before. Haven't they in effect exposed more people to framing on an introductory level? I know plenty of our customers go to them when they would have gone to us previously but conversely it seems to me we eventually get some of their customers who were introduced to framing but have grown disenchanted with service, quality and selection.

 

[negavert]

I'd agree with Kathy; when customers grow dissatisfied with big box framing, we're always here. I love it when customers bring in pieces framed by them and the frame's coming apart or the art worked itself loose and they end up getting it reframed. Then we do a stellar job and they tell us that they regret going to the first place. I'm sure all of us has heard horror stories from our customers about those places...

 

[B. Newman]

Originally posted by Jim Miller:
Where do their huge retail markups and the silly discounts end? 80% off? $500 off a $1000 order?

Reminds me of the two guys who were selling watermellons. They would drive to Florida, buy watermellons for $1, then drive back north and sell them for $1. They weren't making any money. (duh) So in trying to decide what to do, one of them said, "I know!" We'll get a bigger truck!

Looks like they need a bigger truck!

Betty