Čau Down

It’s human nature—You see a clock ticking backwards and you’re suddenly on edge. In this case, it’s counting down a window of time when you can buy a dinner for two at Prague’s “hottest Italian restaurant” for 940 Kc. For those losers who just walk in off the street, the three course meals will run them 1,940 Kc.

But you’re not a sucker. You’re in the know. You’ve signed up for the right web sites that tip you off to which restaurants are willing to fight for you to be their customer. You tell yourself you’ll come back and buy the deal after lunch, but that’s when you notice the thermometer graphic next to the clock—its mercury seems to be only a few notches below ‘Sold Out.”

Almost sold out!? There’s no way in hell you’re missing out on this, I mean, everyone else is buying it! What’s the name of this restaurant, anyway? Nevermind, the photos show a cool-looking bar and a hot chick eating spaghetti.

Later you idly wonder how long it’s been since you ate at your once-favorite ‘special occasion’ restaurant. The one you used to save for and spend three hours on a dinner when life had taken a happy turn. You wonder why they haven’t offered any coupons, then shrug your shoulders. With your new coupon-scouting ways, you’ve been able to eat out twice as often as you used to, and never the same place, twice!

————–

O.K. I admit, this scenario may seem overly cynical, but it’s one that the anti-coupon camp would point out is indicative of the problem with discount sites. Groupon has hit the big time–and they hit it FAST–in the U.S., and the Czech Republic is a swift and enthusiastic adapter of the business model. I wrote an article about it here for this week’s business section.

The day after we went to print, I noticed the NY Times had taken a hard look at the coupon-site effect in New York City. It’s certainly not the first look to consider the potential downsides of offering coupons. This Portland, Oregon restaurant owner lost $8,000 on a Groupon campaign, and her blog post about it became viral last September. A quick internet search will turn up a lot of recent media attention about the darker side of coupons, in the U.S., at least. How soon until it happens here? A lot of what I read in these stories was echoed in the conversations I had with Czech coupon web site purveyors and restaurant owners last week.

One restaurateur quoted in Glenn Collins’ NYT article says “everyone and their mother is walking in the door with discount sites.” The Czechs, it seems, are following suit.

When Slevomat founder Tomáš Čupr asked me how many sites I thought there were in the Czech Republic, I answered ‘several.’ He had a good laugh, and explained to me that in the past year, the number of discount sites has gone from 0 to over 200. Slevomat, which launched April 12, 2010, was the first and remains the biggest with nearly 350,000 registered users. Čupr is 28 years old, smart as hell and a great entrepreneurial success story.

While business owners undisputedly have profits as one of their main goals, I had to believe him when he said his company wasn’t just out to sell, sell, sell and make a quick buck. He says his company is a marketing tool for small to medium sized businesses, and that’s true. There is no denying that going this route will fill your dining room.

But Čupr is also very much aware that this transaction must work for the restaurants, as well, if his businesses is going to be around for the long haul. Customers that come in with the coupon need to come back again and pay full price for this model to work for Restaurateurs. The Czech Republic is a small place, he pointed out, and those restaurants and businesses have to benefit from what he’s offering if they’re going to do business again.

“The short-sighted view is that you’re selling coupons and making as much money as you can on that day,” he said. “But you’re obviously not going to make that much money because it’s heavily discounted. What this is is a marketing tool, and a very effective one.”

“If I’m a restaurant owner and I give 150,000 crowns to radio advertising, I would get very few customers. If I offer discounts on Slevomat equal to that same amount, I can guarantee customers will walk in and I will actually have the opportunity  to work with them. This is what I need to reiterate constantly to businesses.”

The question, then, in this brave new world of discount sites, is whether the irresponsible discount shills will fold before the companies with more careful business models get their reputations tarnished. While Čupr’s aim is to create a win-win situation between customers and businesses, some restaurants say they only stand to lose.

I got an easy tip on who might be seriously opposed to this new model during my interview with Mr. Čupr when I asked him if he ever got the brush-off from restaurant owners. The Ambiente Group, he admitted, hasn’t been interested. But he hinted at a more strongly worded reaction from Zdeněk Pohlreich, the eminently recognizable chef responsible for Divinis and the Cafe Imperial. (Full Disclosure: In my role as restaurant critic, I once gave Divinis the highest rating The Post awards).

“He doesn’t like us,” Čupr laughed.

No, Pohlreich does not like discount sites. I confirmed this after sending a quick, and neutrally-worded email requesting an interview on the subject. He calmly informed that he hates these discount web sites with “a passion,” and emphasized that sentence with no fewer than six exclamation points. I don’t speak Czech, therefore I don’t watch Czech television programs, but I’ve gathered the man isn’t known for mincing words. It’s an admirable character trait that makes for great television and is a journalist’s dream come true.

He explained himself further later on the phone.

“I wrote to these people that I have had it up to my ears,” he said of his exchange with Slevomat. “Restaurants have their costs, good food has its costs, and I don’t know why I should share my profits. I don’t share my costs so why would I want to share the profits?”

“I’ve been through it a million times, I talk to a lot of restaurant owners when I’m shooting my shows and I ask them about giving discounts. I don’t know why they do it, I tell them they have no clue, no idea what the cost actually is. They’re just happy to see the restaurant is full of people but they’re too stupid too realize they’re not going to make any money from this.”

“Really it’s the same as all those other clowns, the food reviewers and bloggers and all that.”

At this point I laughed, and in a moment of stupid bravado, interrupted him to say I was also a restaurant reviewer at The Post. It’s interesting how courageous one gets over the phone.

It would be easy to dismiss Pohlreich’s viewpoint as one that smaller businesses can’t afford to have. Čupr said he understands why Ambiente might turn his offer down, they’re always full, after all. And Pohlreich’s marketing is taken care of by his television shows, cookbooks and other visible promotions.

Glenn Svarc is not a celebrity chef. He has built a solid reputation for his restaurant through enormously hard-work as both chef and owner of Osteria Da Clara in Vršovice. He maintains a lively Facebook page for Da Clara, a tool that has been a boon for small business owners. Most days he enthusiastically announces the restaurant’s daily specials in Italian, English and Czech, and he uses the platform to ask for suggestions from customers. Occasionally, he vents and offers insights into the ups and downs of the restaurant business, whether it be customers’ failure to either make or keep reservations or the tendency to eat out only on weekends.

He and his business ‘are doing well and manage to survive’ he told me happily. I asked him if he’d used coupons or would consider using the service.

“I hate these discount tickets. It’s not my style and it’s a sign of desperation,” he said. “If people can’t appreciate our already reasonable prices for good, honest food, then they should go somewhere else.”

Clearly, passions run high on both sides, and I’m nowhere near surprised. I’ve been writing for newspapers for eight years now, but I don’t think I’ve ever encountered such an inflammatory topic as I have covering food for the past year and a half. Well, there was that one school redistricting plan,  but crazy American parents take their own category.

It’s exhilarating, too. Chefs and restaurant owners, in my opinion, are some of the most clever, stubborn, no-bullshit taking and creative souls I’ve had the fortune to interview. When they’re good, their integrity is nearly unmatched by any other profession. They also, for the most part, passionately hate food critics, i.e., me.

That antagonism can also extend to customers who claim to know better (hold the sauce, chicken instead of beef) or don’t want to pay full price. As Pohlreich said, “I’d rather close my doors.”

Brewsta’s CzechPlease blog has been my go-to since I moved to Prague, and if you’re reading this, it’s probably yours as well. I can’t even imagine how many restaurant meals he’s eaten in Prague. I asked him, as perhaps Prague’s most prolific restaurant diner, what he thinks about coupons. While he said he never uses coupons, it’s not because he’s opposed to the business model, per se.

“I never use coupons from such websites, but mostly because I hate giving any personal information to any commercial website and not just my name,” he said. “I don’t even like giving out my email address.”

But he did add that he’d heard some positive feedback from one restaurant that took advantage of the coupon strategy.

“One success story I heard was from Isaac and Adam at the Dirty Dog. They said their coupon promotion brought in tons of people and help put them on the map.”

The Prague Post reimburses me for review meals. It’s a perk, but it also means I’m going to hold back from forming my own opinion on discount-sites. I am self aware enough to realize how insufferable that would appear. So instead, I’ll ask you. What do you think? Have you used these discounts? Is it as black and white of an issue as some would argue? Let me know!