Assessing the Economic Impact of Restaurant Coupon Removal on Diners’ Consumption Behavior: A Theoretical Analysis

In this chapter, after making them available to customers for a period of time, I researched how customers react when a restaurant stops issuing coupons. Distribution of coupons will improve company revenues and save money for clients. As a consequence, my theoretical research indicates that this strategy will reduce the consumption demand and utility of consumers to a level even lower than the level of pre-coupon. The aim of clients to revisit the same restaurant was disappointed by the coupon denial encounter. Customers who used the coupons and appreciated the reduced prices, more significantly, would A restaurant that avoids distributing coupons instantly feels less valued. A demotion expense would also result in a smaller operating budget and a drop in consumers to even lower levels than pre-coupon levels. As a result, my theoretical research indicates that because of the lack of coupons, which makes consumer demand more elastic and the demand curve, that is, the demand curve will become flatter, consumers will be more susceptible to price rises.

Author (s) Details

Dr. Tin-Chun Lin
School of Business and Economics, Indiana University Northwest, Gary, IN 46408, USA.

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