Louisville Originals gift certs on sale 10 a.m. Thursday

:idea: ....Oooooo-Ooooooo...I think I get it now. Help me out here...do I have this right ? Spank me if I don't.

So what I do is line up in a cyber-que. When the little bell rings I (quick like a bunny) put these certificates in my cart and proceed to check out. Oh lucky me, I've scored six $25 certificates for a mere $17.50 each ($105)...of which <eh-hemm> NONE of this money actually goes to any of the restaurants. So now I proceed to the first restaurant where I spend exactly $26 (come on, you know you've done it). When my check arrives I give them my $25 certificate, a crusty dollar bill from my pocket and tip the server the requisite 20%. Lucky me. I just enjoyed a $25 dollar meal, only spent $18.50 (plus tip) and guess what ? The restaurant made a grand total of one crumpled up dollar bill. Of course we have to subtract the cost of the food from that dollar...sooooo lets see <sound of adding machine> Hmmmmm...it would appear the restaurant actually LOST money on my visit. Ahhhh what the heck, it's a "loyalty" program. Right ? But wait there's more. I get to do this FIVE more times AND (wait for it)...............on top of all this I get to pat myself on the back because of all the "support" I've given these local establishments. Why now that I think of it what if (lucky me) I got extremely lucky and scored 6 certificates to the SAME restaurant...why I could go there again and again and again. Just THINK of all the support I would be giving that establishment then.

Hmmmmmmmmmmmm.........OR

I could just forego the cyber-cue...visit the SAME restaurants, enjoy the same food, suck it up and pay the extra $7.50 and walk away a little lighter in the wallet but comforted by the fact that I really DID support a local establishment.

dilemmas, dilemmas...What IS a feller to do.

Kinda what we experienced. We had the same people coming in month after month with a gift certificate. They would say "we bought five to your restaurant". I would say - through gritted teeth- "Thanks" . We finally dropped the program. I guess it works for some restaurants but it did not for us.

We had no idea what the program entailed for awhile. Then, one of our friends at one of the participating restaurants explained the program and how the restaurants eat the cost to participate. Since then, we only buy an LO gift certificate for restaurants we wouldn't normally have gone to. Either that gift cert has brought us to a restaurant we discovered we loved or realized wasn't our thing. We really appreciated the knowledge of how the program works - most people don't know, and knowing is half the battle.

In every case when we have an LO gift certificate, we spend at least double the value of the certificate. There is always alcohol purchased, which isn't covered by the discount. We see the certs as an incentive to get us into a place (loss leader, I guess is the term) but only the starting point. An excuse to have a really nice night out.

Whether I knew or didn't know the details of the program, I could never imagine buying 5 for one place. That's greedy, and shows the restaurant you've become a "regular" at that you don't really care about their survival; you only care about getting your good deal, time after time. People like that make me feel like I need to take a shower.

Not defending or arguing anyone's position on this so far. But if it is such a bad deal for the restaurants as presented in this thread, why are 33 (not counting multiple locations, i.e., two Rovers, two Cafe Lou Lou's) Louisville independent restaurants involved and honoring the program? There must be something in it for them. Can a member explain the advantages, if any?

And there are many Louisville independents who are not involved, some like Will, have commented as to why they decided not to participate. Their choice, and their legitimate business decision. Any other local non-member "Louisville Originals" with other insights?

Many thanks to all who have posted about their use of the Louisville Originals web certificates, gift cards, and rewards program. It's good to know that they are achieving their purpose, and that you, as customers, are enjoying the programs.

I am unclear why William Smith is posing his questions about the Louisville Originals here, rather than contacting any of the LO board members listed on the the LO website, but he seems to believe there are nefarious doings afoot. I apologize for the length of the following, but I need to say it given the tone of some of these posts.

I -- along with Andrew Hutto, all of the current board members, and a handful of other LO members -- have put in countless hours to build an organization dedicated to promoting independent restaurants. I resent the implication that we are somehow profiting from this endeavor (we receive no compensation of any sort for our time) or creating "smoke and mirrors."

LO is a local organization run by a volunteer board of LO members. There is no "central location" or larger entity involved. We hold bi-weekly board meetings which are open to all members, although very few attend and even fewer attend on a regular basis. The meeting announcements, along with minutes from the previous meeting, are sent to the entire membership. There is total and complete transparency as to "where the money goes."

We are restaurant owners, not technological savants or organizational gurus. We do our best, and we meet so frequently so that we can address issues -- such as potentially fraudulent use of the rewards cards, or website glitches -- as they arise.

If anyone is truly interested, here's an overview of how the program works:
Restaurants that meet the requirements (listed on the website) pay a one-time fee of $250 to join. They also agree to participate in the LO gift card and rewards card programs. Instead of annual dues, each member restaurant also agrees to provide $650 worth of discounted web certificates in each of four quarterly sales.

The monies generated by these sales fund the LO programs, and the restaurants are out the cost of the goods sold, or roughly 1/3 the face value of each web certificate redeemed (and not all are). Of course, as some posters point out, they may also have gained a new customer who tried them because of the discounted web certificate, so the advantage over dues seems pretty obvious.

All of the money -- to the last penny -- goes toward promoting independent restaurants in Louisville, though not necessarily through advertising. Frankly, we don't have a big enough budget to mount an effective group advertising campaign, so instead we focus most of our limited ad dollars on underwriting to provide greatly discounted individual advertising opportunities to our members. BTW, we've also negotiated many LO member discounts with local merchants; however, the buying program which William Smith mentions is NOT an LO program...although we are working with the company to provide greater access and preferred pricing on KY Proud products for LO members.

The bulk of the budget, of course, goes toward running the website and the gift card and rewards card programs. LO picks up the tab for these programs. Members pay nothing, although they do incur the cost of any rewards redeemed in their restaurant (again, the hit is the cost of the goods sol, not the full face value of the redemption). LO members are reimbursed 100% on gift card usage, and they recieve a wealth of marketing info, tools, and customer feedback through the rewards program.

Yes, it can, occasionally, be painful as a restaurant owner to redeem large amounts, but when I compare redemptions to the amount of sales generated by Rewards Card customers, it's clear I'm coming out way ahead. People are loving this program, and I don't want to think what customer reaction would be if we dropped it!

It's pretty much the same with the web certs. Yes, there is the occasional customer driven only by the discount, but most are like the LHB posters who say they use the web certs to try new places or re-visit a place that's fallen off their radar. I'm confident we can use these visits to convert them into Rover regulars.

The cost of accepting the web certs and redeeming rewards is part of my promotion and advertising budget, and the LO programs are working quite well for us. It is your prerogative to disagree, but please refrain from belittling and besmirching the good faith efforts of fellow restaurateurs trying to help themselves and their brethren in a tough business.

Thanks to those who stuck with this, and I hope I cleared up some confusion.

Michael Reidy
The Irish Rover and Irish Rover, Too

The long explanation was useful.

But I'm with Steve. I go eat, pay the tab, tip appropriately, and leave.

I also don't use "lowest gas price finder" mapping software.

Many thanks to all who have posted about their use of the Louisville Originals web certificates, gift cards, and rewards program. It's good to know that they are achieving their purpose, and that you, as customers, are enjoying the programs.

I am unclear why William Smith is posing his questions about the Louisville Originals here, rather than contacting any of the LO board members listed on the the LO website, but he seems to believe there are nefarious doings afoot. I apologize for the length of the following, but I need to say it given the tone of some of these posts.
.....

I am glad you explained the ins and outs of this program. After reading some of the posts, I still can't understand why some of the posters have such a difficult time grasping the value of a loyalty program vs cost. I didn't mention this before, but recently I took a colleague to Limestone for lunch...selected because it was an Original and close to my office. He was so impressed that we have gone back 3 more times after that, and it is one of his new favorite places. Had Limestone not participated in the program I probably would have taken him to the Bristol on that first day, and they would have lost 3 nice sized lunches (4 people each time after the first), the dinner he already has planned there, and any future business from him (there will definitely be more). This does not even take in to account my repeat visits and recommendations which are closely tied to program participation. These are the things I am afraid some people are not taking in to account because it is impossible to quantify people's reasons for visiting an establishment unless you ask them. The owners of Limestone will likely never know these sales are attributed to their participation in the program.

I should be clear that I do not buy the web certificates, and shame on those who take advantage of them. Even so, I can't image the cost (as described by Michael) could outweigh the benefit. I don't go strictly to Originals places because there are so many other good ones, but they certainly get preference and are frequented more often. I used to basically live at various Marriott's around the country when I worked as a consultant, and I chose them strictly because of quality, consistency, and their rewards program.

Again, sorry, I really don't know him, but, what Will just said . . . . especially the first paragraph.

I guess we're editing now.

I would just like to say that I find this discussion to be interesting & that I hope some sort of "truth" can be established. I've never been one to use gift cards (nothing says "I don't care enough or know you well enough to buy you something that you'd actually need/want" like one of these) or web certificates (other than that 1 time on restaurants.com which ended up having so many conditions that it wasn't worth it) but I am a member of the LO rewards program. My wife & I try our best to only dine at local establishments (even when we're traveling) but i must admit, as someone who is hoping to open their own restaurant & as a consumer, I can't help but wonder if certain aspects of this program do more harm than good (specifically the gift cards & web certificates program). Does it merely attract the restaurants.com crowd of people who don't necessarily care about "local" & are merely looking for a cheap place to eat on their way home from Walmart? Would the program implode if there was only the rewards program & the other programs were dropped (or at least changed)? What is it that LO does as far as advertising (other than a website that may only be popping up when people are looking for cheap places to eat) that a decent restauranteur couldn't do on their own? Like someone mentioned earlier, I haven't seen more than 1-2 LO advertisements (I don't specifically remember seeing any but I'm trying to remain open-minded) & only found out about the program from a friend via word of mouth (a methodology that all restaurants have access to). I do however see countless advertisements in LEO & other places for restaurants that are presumably doing their own advertising (or at least doing so through some type of service but I have no way of knowing if that's through LO or not). Anyways, I don't have much to contribute other than just saying that I this discussion continues & simply sharing my concern(s). I want to like the program but as a consumer (& future restauranteur) I just can't figure out which side of the fence I'm on due to a lack of information. Then again I'm not exactly the target audience for most of the LO programs (other than the rewards card) so maybe it doesn't matter.

Thanks to Michael for clearing up some of the points I brought up. You have been a stand up guy ever since I knew you when you were waiting tables ages ago. I could never get much of a response from LO when we were members. It took over a month just to get a sticker for the window... and a few other problems.. bu I was in no way questioning the validity of Louisville Originals, or its financial prudencey. I just really wanted to know where the money goes. I still don't quite see the numbers adding up, but in no way did I mean to suggest any nefarious dealings were going on. What I don't see is why we as a group of individual business couldn't do this on on our own. I'm pretty sure LO is a for profit organization and based pretty closely on others around the country., so I felt the right to ask a few questions, being confused, that were never answered before. LO is a great group of restaurants, maybe not structured the way that would benefit all of us, but none the less, apparently serving many in a lucrative manner. All of the board members are restaurant owners, and I guess give up the coupon money sold for their restaurants for the common good of promoting other local restaurants. Very noble indeed. Thanks for clearing up some of the confusion. I think many valid points were brought up in this discussion and don't apologize using this forum for said conversation.... to be continued I'm sure.
Thanks Again
William Smith
Shady Lane Cafe