Coupons use rising, retailers attempt to lure consumers back

McALLEN - Frugal diners trickled into La Justicia Mexican restaurant clasping a coupon for a free enchilada plate and teaching restaurateur Jorge Martinez an old lesson that ailing retailers and other eateries are quickly rediscovering:

Discounts and coupons are a powerful tool in luring cautious spenders back to stores and restaurants during the nation's worst recession in decades.

"When they see something like that they tend to come in," Martinez said by phone from his restaurant near the intersection of 23rd Street and Dove in McAllen. "It's just a matter of trying your best to get more customers in and keep it going."

Facing swelling unemployment and an almost daily barrage of gloomy economic news, consumers are clipping, printing and hunting for bargains in greater numbers.

"Coupons usually work," Martinez said. "It's actually better than doing advertising on the radio and TV and stuff - you're throwing all that money away and it's not a guarantee."

In-store coupon use at Texas grocery giant H-E-B was up 22.8 percent in 2008 and the redemption rate on manufacturer coupons is the same, according to figures provided by the store.

Shelley Parks, a spokeswoman for the company, said the rise in coupon use began in October - a month when the recession spread rapidly and employers began shedding jobs daily across the country.

"It's definitely a trend we're seeing," she said. "The holidays kicked off people being more cautious."

Chris Leonard, 54, an art professor at the University of Texas-Pan American, often buys the generic, store-brand groceries at H-E-B and seldom uses manufacturer's coupons. Discounted name-brand products are often still more expensive than their generic counterparts.

"I guess I'm a creature of habit on the brands I like," he said as he loaded groceries into his Ford.

Still he occasionally purchases H-E-B's meal deals - a package discount that offers all the fixings for a dinner, including sides, at a discount of up to 20 percent.

Newspapers and other traditional print media are also still filled with coupons.

New York Deli II owner, Gilbert Rendon, recently began issuing a coupon in print for a free bowl of soup with a lunch purchase. Bucking a national trend, Rendon's sales have not fallen that much. Still, a coupon could always help bring customers to the store.

"I can't complain. It's been all right," he said. "Last month was a real good month, then school got started up again and it got slow. It's not too bad here."