O'Reilly logo
  • Dustin Waybright thinks this is interesting:

Observe that the type of the COALESCE expression is determined by the returned element, whereas the type of the ISNULL expression is determined by the first input.

From

Cover of Training Kit (Exam 70-461): Querying Microsoft® SQL Server® 2012

Note

ISNULL forces the data type of the first input, so a VARCHAR(3) data type then converts the second input from VARCHAR(10) to VARCHAR(3).