Groupon is branded as a place for group buying, whereby a deal only becomes available when a tipping point is hit. In reality, the site has simply become a deal-of-the-day shopfront.
Its meteoric rise has been well analysed and largely boils down to superb execution; such as their aggressive efforts to consolidate the market and the hiring of a huge sales force (I bet you didn’t realise they have some 5,000 employees). Another key aspect is timing, with increasingly thrifty consumers and investors keen to back the next big scalable venture. Groupon would surely have not risen to its current status without Facebook and social media. Yet, I believe it’s poorly utilised. Here’s some thoughts on how Groupon could be more social:
- Group deals. Some offers are innately social – group activities, dinners and so on. I often see people share a deal on Facebook hoping to recruit others to join them. Why not build that into the Groupon experience? Have a user commit with the credit card, but not be charged enough friends also commit. This opens up a whole new range of potential merchants Groupon could work with.
- ‘Got a Groupon’ sharing. Once a user makes a purchase, Groupon could do a whole lot more to encourage the user to share the good news. Rather than a simple Share button, deeply integrate social features and allow the user to share with specific friends, earn loyalty benefits through Groupon, and share rich information through their profile.
- Sliding scale group buying. The more people buy, the greater the deal becomes. Somewhat flawed as too many people would holdout until the deal improves before committing. That effect be dampened by offering a decent ‘base’ deal that is marginally improved as more users join. Uniqlo ran a similar campaign, where prices dropped as more Tweets went out. This way, users are incentivised to share and spread the word – the impact is huge.
- Post-experience sharing and caring. The merchant may well collate some information from each customer, but Groupon certainly has the ability to reach you after the event. Why not blast out an email to every consumer a week after their experience? Thank them for their purchase and solicit them to check out the merchant’s Facebook Page, follow them on Twitter, or leave a review on Tripadvisor. If the user had a great experience (likely helped by the fact that they got a good deal), then they’d be more willing to share their thoughts. Groupon can be somewhat impartial and invite users to leave both negative and positive, helping build its credibility too — all whilst preventing nasty privacy complaints since no data is passed onto the merchant. The flurry of activity generated through these channels would gain the merchant a heap of earned media, extending the ROI from the promotion. Margins are tightened through Groupon, so merchants count on repeat business and word of mouth — yet Groupon fails to facilitate this through social media.
What do you think?
Update: Zuppy allows SMEs to build their own deal-of-the-day feature. Interestingly, one of the features is to enable the the tipping point to be linked to the number of Facebook Likes.