Are on going discounts dangerous for businesses?

It's obvious that discounts make up a huge part of the mid-market dining sector.  Most of the major high street brands have large discount aimed to attract more customers but although this is great for generating foot flow is it good as a long term stratergy or for profits and has it got to the point that the companies now can't survive without these promotions.

Every month I receive my usual email for 2for1 on mains or Pizza for a pound and every week I sigh slightly thinking about the pressure that the marketing team must be under to think of more and more new discounts.  It's not that I don't want a deal or appreciate a good discount but I worry that the smaller independents are feeling the pressure and are having to follow suit.

 I fear that this is a slippery slope and before they know it they are just another member of the heavy discount group, serving average food, knowing that if they stop the discounts they will lose their new client base and potentially loose any type of business.  It's a far step from their original plans.

I no longer see companies such as Pizza Express, La Tasca and Prezzo (to name but a few) as serving quality, I just see them as a place to go if I had a voucher.  It's a shame really because they all started out as great restaurants.

There is another way of course, follow the likes of Cote.  They don't advertise discounts and are certainly not know for vouchers but instead have built up a good group based on quality.  Quality food, drinks, service and surroundings.  So if you are a new restaurant or an expanding group stick to the idea that if its good enough people will come.  Give the customer a great experience and they will come back again and again with or without a discount.

Don't fall into the heavy discount trap, a promotion now and again is fine but don't go over board or your business might just sink.

Philip