Bed Bath & Beyond is slashing the coupons that have long been synonymous with the brand after an internal study found they were partially 'ineffective'
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- Bed Bath and Beyond is moving away from its well-known coupons.
- In an internal study, the company found the coupons were often ineffective or unnecessary to customers.
- Coupons won't completely disappear, though.
- Visit Business Insider's homepage for more stories.
After a major pandemic comeback, Bed Bath & Beyond is ditching coupons.
The retailer is known for coupons offering 15 to 20% off its selection of various home goods, which customers often receive in the mail. As part of a new strategy, Bed Bath and Beyond is hoping to increase profits and compete with other retailers instead of fostering an "overreliance on the coupon," Chief Merchandising Officer Joe Hartsig told investors on Wednesday according to CNBC.
The company said that it studied online carts of 405 million shoppers, encompassing more than 285,000 items, and learned that 40% of coupons were "ineffective, according to CNBC reporting. Bed Bath and Beyond has also grown among a younger demographic, who are 20% less likely to use coupons.
But coupon fans don't need to panic. CEO Mark Tritton assured investors that they will not do away with coupons entirely, but will "leverage [them] as a true strength," CNBC reported that he told investors.
Photo by Lawrence K. Ho/Los Angeles Times via Getty Images
Bed Bath and Beyond is faring unusually well during the pandemic. With students across the country turning to online learning, the chain saw 89% growth in digital sales in Q2, thanks to a strategy of analyzing how remote schooling would impact customers' needs, and adjusting stores based on their proximity to schools.
The two million new customers who turned to Bed Bath and Beyond's website are younger than before and more interested in home decor Chief Brand Officer Cindy Davis told Business Insider earlier this month. The store is preparing to use the same strategy as it gears up for the holiday season, its other major sales driver.
Bed Bath and Beyond executives have talked about ending the reliance on coupons since at least 2016, focusing instead on building loyalty to the Beyond+ membership program. Customers don't seem to care that much about the coupons, anyway. In a 2018 Morgan Stanley study, only 50% of Bed Bath and Beyond customers said that they shopped at the store because of its coupons, a lower number than in previous years.
"Consumers seem to be growing indifferent to this offer," a Morgan Stanley analyst wrote in 2018, which looks to continue to be true.