What's Behind the Best Deal Ever

Feb 1

You probably have one in your car’s glove box. Or, if you are like me, you have a folder of them, filed somewhere for that day when you might need one. The F.B.I. even found some in the junk drawer of a notorious mobster Whitey Bulger when they searched his home.What am I talking about? It's the 20-percent off coupon from Bed Bath & Beyond! Oversized, under designed, and printed in a Pantone 2735c blue that’s become instantly recognizable as the best deal ever.Coupons. Print. Direct mail. Words associated with ancient marketing history considering today's online world. Yet, the Bed Bath & Beyond mailer known as Big Blue has earned its hallowed place in the annals of marketing history as a promotional and cultural phenomenon.As I read a recent article in the New York Times on the coupon’s history I wondered, “What can entrepreneurs learn from something that takes place on the massive scale that this coupon reached?” Turns out, alot. (In case you have been living under a rock, or somewhere with no postal code for the past 25 years, here is the coupon in all its big, blue glory.)

HUMBLE BEGINNINGS

Rita Little, the store's VP of marketing from 1997 to 2013, had been tasked with taking the company from 60 to 100 stores (under its original management, the company had about 1,400 stores).At the time Little joined the company the coupons were infrequent, standard size, and featured $5-off deals only. She wanted a Fourth of July promotion with "a little zing" and a discount of 20%, a percentage she found moved the needle. She took the card to the company's outside agency. "They saw the postcard for what it could be," she told the Times. "The agency did all these markups, and they came up with this big, blue thing.”Instead of hot colors which were too harsh, they came up with the color they came to call “blurple.” The color was right. The science was sound. The card was now big enough so when it came in with a stack of mail, it was impossible to miss.The coupon by itself worked, but what really rocketed it to best deal ever icon status were THREE things.

Why Bed Bath & Beyond Coupons Work

ONE

The coupon didn’t promote just one item which was a lot less expensive to produce and also made the card more relevant. People could use it for anything they wanted. Everyone wanted to be on the mailing list and left their addresses with the store’s cashiers. They in turn sent them to headquarters were they were added into the data system.

TWO

There is no “real” expiration date. As word got around that you could use the coupons anytime they became something you’d keep until you needed them. Scott Hames, chief marketing and analytics officer from 2000 to 2018 says, “Think about the branding. People come in with five coupons but they’ve kept them six months. They’ve seen them every day.”

THREE

When it was first created, you had to come into the store to use a coupon (now it applies to online orders as well). And that was how they amortized the loss of that 20% discount. Merchandising is the secret sauce of Bed Bath & Beyond. You might come in for a blender and leave with a lot of things you never knew existed ... I now have spatulas in all colors of the rainbow and many pizza cutters.Are coupons for every business? No, but the lessons here are big – about as big as an oversized blue coupon!Go your own direction. When the competition -- Target and Walmart -- was turning to TV, Bed, Bath & Beyond turned to print and direct mail. At one point, they were sending out nearly a billion pieces of mail a year.20 percent moves the needle. “It’s enough to get you off the couch if you’re waiting to shop the pricey item,” Little says.Finally, this is marketplace proof of what I wrote about last week -- you only need an eighth of an inch to stand out!