Remember the last time everyone freaked out about the end of Bed Bath & Beyond coupons? There were worries that the retailer would shift more coupons to members of its new loyalty program, and make fewer of them available to everyone else. But so far, the fears have turned out to be unfounded, since Bed Bath & Beyond never actually said such a thing.
But Michaels kind of just did.
Like Bed Bath & Beyond, Kohl’s, JCPenney and plenty of other stores, Michaels is the kind of place where you would never think of shopping without a coupon. And that, Michaels says, is part of its problem.
The craft store chain announced some disappointing earnings for the second quarter in a row yesterday, blaming it in part on the fact that more and more bargain-seeking customers are coming in with one of the store’s ubiquitous coupons in hand.
“The number of coupons we’ve put out there was consistent with what it would have been a year ago, but the customer was using them more,” Michaels CEO Chuck Rubin told investors yesterday.
So the company is making some changes that it hopes will help to boost sales, without being overly reliant on coupons to get people in the door.
One way is by shifting more of its promotional discounts to members of its new loyalty program. “Michaels Rewards” launched over the summer, and already boasts more than ten million members. As the retailer learns more about its loyal shoppers’ interests and preferences, “many of our deeper discounts will be targeted to loyalty members,” Rubin said, “focusing on offers which resonate with specific customer segments.”
In short, “we’re going to be aggressive,” he pledged, but “on a targeted basis.”
More targeted, that is, than just firing up the printing press and churning out more 40% and 50% off coupons for just anyone to use.
Another new strategy is to get people to feel like they’re getting a good value, even if they don’t shop with a coupon. So Michaels plans to lower prices on many key items throughout the store. “We are testing a new everyday low price program on a limited number of highly visible items across a broad range of categories, to provide clear compelling value to the customer who doesn’t want to wait for a sale or a coupon,” Rubin said. “It is not a transition of our storewide pricing strategy,” he explained, but a way to provide value on “the core essentials, the milk and eggs of our business.”
And if it means more people will shop at Michaels without feeling like they’re being overcharged unless they have a coupon, all the better.
Finally, the last part of Michaels’ new pricing and promotional strategy involves not changing prices at all. The company needs to “highlight the really good values that we have already,” Rubin said. “It doesn’t involve us lowering our price. It simply involves us taking our current price and showing it more prominently.”
So the next time you visit Michaels, if you notice lower prices on everyday items, large signs emphasizing those everyday prices, and great deals in your Michaels Rewards account, then maybe you won’t mind so much if you find fewer Michaels coupons out there.
Michaels – and its anxious investors – certainly hope so.
I take offence to this statement…” just firing up the printing press and churning out more 40% and 50% off coupons for just anyone to use”. Should the customers coming into the store and spending their money be referred to as ‘just anyone’. I have been a loyalty customer since the beginning and I have to just laugh every time they ask me at the cash if I am a rewards customer because I have yet to see any rewards. I don’t get these fantastic emails they claim they send with special savings. All I ever get in the email is the current flyer.
The ‘everyday value’ is a joke and just a way to prevent the customers from using a coupon on it. I would prefer it went back to the way it was and charge a little more so I could use a coupon and get it at a better price than the everyday value.
Since they started their everyday value deals I have walked out of the store lots of times empty handed (except for the coupon) because I wasn’t able to use the coupon on anything I needed or wanted at the time due to the fact that the everyday value was more than I could get it somewhere else.
Hope they go back to the way it was before they end up having to close the doors.
I always bought the helium tanks for party balloons at Michael’s. They were $25, and $15 with the 40% off coupon. I went to buy one a few weeks ago and it is now an “everyday value”, so no coupon could be used! I guess I will have to get it at Walmart now where they are $20. JCPenney was the same way — the “everyday values” are not a good value!!
Exactly! Hence JcPenny out of business mostly everywhere ….
really,you got to be kidding?coupons in this day and age are what makes people come into the store.why would you get rid of something that works?kind of like kmart and the blue light specials and what happened when they stopped that,they are now going under and closing stores and if thats the way companies think then they need new people to know how to run a business.keeping coupons and lowering prices will ensure that more people come into stores and spend money.people dont want to have to have more plastic in their wallet.what we want is more coupons and to be able to combine and be accepted by the competitors.I would rather shop where i can do this and save money then to come into a store with more plastic to try to find in my purse.start listening to your customers and maybe opening up stores in locations so more people can come in to spend.I hear how a lot of people have to drive upto three hours one way to shop.this makes no sense at all…just try to find a better way.plus stop saying one thing and then changing it a minute later…just be a good store,thats all…
I know of an employee who was “written up” for letting the costumers use the in-store coupons. So, basically, the logic behind this thinking is “We’re losing money because of the coupons we print and give out. But, if our employees encourage the use of those coupons we can threaten the job/livelihood of the employee (for which we only pay minimum wage or a few pennies more with no more than 20 hours a week, mind you) for allowing costumers to use our freely given coupons.”
Yeah, that’s sound logic.