Wednesday, February 1, 2012

Group now-the new face of local advertising

Let's face it-when you heard that Groupon refused the offer of $ 6 billion from Google had to think about-the pigs get fat, but the hogs. Group certainly looked like in the pig. Come on, the group is not an exceptional service-it's just a local e-mail list with quotes from different companies, which drastically reduced in price with the Groupon property is about half the price. It is a way to keep your customers subscribe to the new companies, which offer, but the question, which will continue to come back, when the offer expires or wait for the next deal of the day from other companies with a better offer?

Group is the number one provider of online daily discounts and has over 70 million subscribers, is anxiously waiting for the deal of the day in the window of their e-mail in 550 markets around the world. This was achieved in just 3 years. But now competitors are sprang up everywhere. Where the group now? Group now!

GroupOn is a new mobile application, which the company hopes that will change the way people eat, shop and play. Now the GroupOn property is revolutionary variations from the current daily Groupon is agreement format-the real time optimization of the agreement. It works like this-when a user opens their Groupon now smartphone applications that will be greeted by two buttons-"I'm hungry" and "bored." Click on the button "I'm hungry" your phone transmits its location on the servers group, and then displays the time of a specific agreement on local restaurants in the immediate vicinity. The offer is special, that discount is good, and only in certain hours in this special day. Group offers in real time with the right to the point-are displayed on the map in your phone. Rather than receiving email in the morning at your desk, displayed to the user agreement, their location via smartphone or access to the Web page of the group.

The aim now is to help eliminate the destruction of the Groupon warehouse-fill in of the President of the hairdresser, who had just had a cancellation, the Find tickets to the North-Central concert at a reduced price, or by filling out the Jimmy's grill terrace on a sunny day. Traders may amend the agreement, change the time and edit the menu, as deemed appropriate-are in the control. All in real time.

It's a game changer for online coupon industry. Before the barrier for entry into the industry have been low-anyone with human beings, a database, Web pages and sales could easily enter the market. Now with the merge location and opportunities through technological change – fraud will have a difficult time catch up with the group.

GroupOn now is scheduled to begin this month. Local advertising to get more locals now group. It seems that he can fly the pig!

Tuesday, January 31, 2012

Why Groupon Should Not Worry About Facebook Deals

So Facebook wants in on the daily deals business model and has launched Facebook deals as a proposed "Groupon Killer." Makes a lot of sense too because of the volume of Facebook users and the social nature of group buying. No doubt, the deals platform will do very, very well and will certainly gain significant market share and steal revenue away from Groupon and Living Social alike. But I don't see it as a "killer" of anything.

From what I've read so far the difference between the Facebook Deals model and Groupon is the delivery of the deal. Facebook is betting on social elements like sharing via a "like" with friends that are in your Facebook network. Groupon, however, delivers an email. To me, these kinds of deep discounts are better served direct, via email. Yes, I know, sounds old school and I realize that Facebook provides email addresses now and some people have even gone as far as to say that email will die in the next decade or so. Fine, in the meantime most of the world still revolves around email. Email, for many of us is how we stay connected, conduct business and share information. There is and will always be a percent of the population that will respond better to an email than a Facebook message or wall post from a friend.

Facebook is also noisy as hell, with a lot going on these days. We have groups, events, places and now deals to pay attention to and that's on top of all of the other clutter we get from our "friends" on a daily basis. Sure, these things all tie together nicely in Facebook. I envision savvy marketers setting up an event linked to a deal and then providing further discounts to folks when they check-in via Facebook places. It's all very symbiotic and pulled together in one platform via Facebook. But how many people actually use the places feature? I'm sure they have a ton of people "activated" on places and I'll bet there are a lot of users actively using it too - but that's simply because of the volume of people using Facebook. With Facebook the numbers will always be staggering.

But for the deals portion and especially when it comes to high conversions I seriously doubt that Facebook deals will kill anything. Groupon has this model down cold. They deliver a witty email, on-time at practically the same time every day and have trained the more than 70 million subscribers to look for these emails. Furthermore, the deals will be different for Facebook.  This quote was taken from a write up done over on the Huffington Post and was given by a Facebook spokesperson:

"We're building a product that is social from the ground up," says Emily White, director of local for Facebook. "All of these deals are things you want to do with friends, so no teeth whitening, but yes to river rafting."

So even the deals will based around social and community. Which is cool and will no doubt catch-on with Facebook users. But, like I mentioned earlier, there is still a large audience for the less social deals. Saving money on things like teeth whitening is relevant for some people, especially professionals who can afford to act on these deals. Which is why I think Groupon will continue to grow and thrive.

Furthermore, I think it would be silly for us to believe that Groupon will always only be a daily deals email platform. I'd venture to say that Groupon has something else cooking and may be working on a social play of its own. At the end of the day, there is enough pie to go around in the space and each platform has its own model and audience. Groupon's not going anywhere - trust me, or Howard Shultz (Founder of Starbucks), amongst others, would not be sitting on their board.

Keep your eye on Groupon and the next move they make.

Product Managers Learn To Get Their Groupon

Hey product manager, so you'd like to find a way to make your product appeal to more customers? Hmm, well let's think about this for a moment - is there anything in your product manager job description that we can use to solve this problem? Maybe there is. Although many of us work for companies that are national or even international in scope, the hard, cold reality of marketing your product is that all customers are local to somewhere. If you want to capture their attention, then perhaps you need to find a way to successfully do local advertising...

What Doesn't Work In Local Advertising

I love watching the U.S. football Super Bowl game every year. It's not so much the sports as it is the very creative (and expensive) commercials that really catch my attention. Sadly, this is nothing that I can put on my product manager resume. However, it has given me a deep appreciation for what advertising can do for a product.

When it comes to focusing on a particular geographic area for finding new customers for your product, you need to start to talk about doing some local advertising. I was startled to discover just how much money firms are spending on doing local advertising for their products. The firm BIA/Kelsey estimates that in 2010 local businesses spent a whopping $134 billion on advertising; however, only $20 billion of that was spent on online advertising.

Hmm, look we live in the 21st Century and as a product manager you've got to be thinking about doing online adverting for your product. As long as you are doing that, I'm sure that the account manager and business development manager that you work with would love for you to help them out by drumming up some more business in various local areas. You just need to find out how best to do this.

Be very careful. It turns out that trying to capture the attention of local customers is much harder than it looks. In the world of online advertising, lots of things have been tried that just didn't work out. Way back in the late 1990′s (is that really all that long ago?) the first attempt to generate more local business for products involved using those banner ads that we all hate to see on web sites.

There were a lot of reasons why that approach didn't work out. However, the next thing that was attempted was a bunch of bets on city-specific guides that the big boys made. Microsoft called theirs Sidewalk and AOL had CitySearch. Neither of those was much of a success either.

I'd be remiss if I didn't touch on Google's AdWords. This has probably been the most successful advertising tool, but it has not done a good job of helping firms appeal to their local customers. It's just too complicated to use!

The Magic Of Groupon (and Others)

As I am very fond of saying, unless you've been living under a rock, you've heard about the firm Groupon. They, along with a host of other similar firms, seem to have found the magic answer to effective online local advertising.

Just in case you don't know how the Groupon model works, perhaps we should take just a moment and cover it. What Groupon does is come to your company and make you an offer. If you'd be willing to offer your customers a 75% discount on your product, they can bring the customers to you. What they will do is make a one-day offer of a 50% off coupon to their very large base of customers who are local to you. The people who want to buy your product will pay Groupon who will then turn around and send you 50% of what they collect.

The math goes like this: if your product costs $100, then Groupon offers it to your potential local customers for $50 and they send you $25 for every person who accepts. Ouch! That's a heck of a discount, but it might be worth it.

If your company is looking to pick up more local customers, then a Groupon approach might work for you if your product meets a key requirement. This may call for just a bit of strategic management. Think about your product for just a moment: does it have high fixed costs and low variable costs? If it does, then making one more costs very little. These are the perfect products for the Groupon type of local selling approach.

What All Of This Means For You

If you want to sell more of your product to a local geographic region, you're going to need to use your product manager skills to find ways to effectively advertise locally. Many ways of doing this online have been tried in the past to no avail.

The arrival of firms like Groupon have identified an effective way of reaching local potential customers. If you are willing to offer your product at a 75% discount, then they can reach many potential local customers with an attractive 50% off discount offer.

The key is to remember that although Groupon created this local advertising space, they don't own it. Other firms such as LivingSocial and kgbdeals along with the big boys of Google and Microsoft have rolled out their own local advertising 50% off deal programs. As a product manager you are going to have to take the time to first decide if this type of advertising program is right for your product and then you're going to have to pick the right advertising firm to go with. Good luck and much success in getting lots more local customers for your product!

What Other Businesses Can Learn From Groupon

Groupon, pioneer of group buying and one the fastest growing companies in history, will have its launch on the stock markets today with an initial public offering (IPO) that's values the business at thirteen billion dollars, more double the $6bn that Google offered for the three year old company last year.

A recent Business Insider profile of Groupon had some fascinating insights on this unique company and its growth, there's a number of lessons that most business owners, entrepreneurs and managers can take from this company's dramatic growth and market leadership regardless of the sector they operate in.

Apply tech to your business Many people make the mistake that Groupon is tech startup when it's actually a sales operation.

Groupon's business model isn't really new, what they have done is applied various web technologies to the directory and voucher shopping industries and come up with a 21st Century way of doing things.

Bringing together different modern tools like social media, cloud computing, local search and the mobile web makes businesses more flexible and quick to develop new market opportunities.

Prepare for quick changes Groupon was born out of another business - The Point. As The Point steadily died, Andrew Mason and his mentor Eric Lefkofsky decided to try something different and Groupon was born.

This ability to change focus quickly - often called "pivoting" - is essential in changing markets. In volatile times like today where today's business conditions can't be taken for granted we have to be prepared for rapid changes.

Fortunately the cost and time to changes your business focus has dropped dramatically with digital and online tools, which is another reason to embrace tech.

Get a good business mentor Eric Lefkofsky bought maturity and a perspective to Groupon's young leadership, having a different and more experienced view of the business helped it develop and grab the opportunity.

An experienced business mentor can be worth their weight in gold.

Back a good idea In Nicholas Carson's Business Insider profile he describes Andrew Mason role at Eric Lefkofski's business before The Point as "an intern, 'kind of squatting in their offices'". Lefkofski was prepared to back the geeky kid camping on his premises.

Putting your prejudices and judgements on the shelf to back good ideas, particularly those that don't cost much to execute, is one way to find where the opportunities lie.

Tell your business story Regardless of what you think of Groupon's claims, they tell a very good story which has lead to their amazing growth and the development of the group buying industry.

Being able to tell your story, in your terms, is one of the great advantages the web, local search and social media deliver. There's no reason why your business shouldn't be dominating the local market in whatever field you work in.

Regardless of what your business does, it can benefit from applying the online tools that are available to all of us.

We may not be the next Groupon but the web gives us the opportunity to build our business to take advantage of the 21st Century. It's worthwhile understanding the new tools at our fingertips.

What Sustainable Society Leaders Can Learn From Groupon

Chances are good you've probably had a Groupon experience. For those of you who don't know, Groupon is an electronic deal-of-the-day website that is localized to major geographic markets worldwide. The concept is quite creative. Every day, Groupon sends discount coupon notices out to millions of deal hunters looking for a deal on product or services. If a certain number of people sign up for the offer, then the deal becomes available to all.

If the predetermined minimum is not met, no one gets the deal that day. The coupon is for the goods and services of businesses in designated cities. Thus, if you were in Chicago, you could get 50% off Bob's Chicago hot dogs for that day, but only if you log in and get the deal from Groupon. Everybody wins. You get a deal on a hot dog because of the coupon you just purchased, Bob gets a deal because he's selling more hot dogs that day than ever before (and you now know about Bob's hot dogs) and Groupon gets part of the take from each coupon sale. While there may be some challenges with the Groupon model (ie: a small business could get overwhelmed), the spirit of the deal is that the collective participation of hundreds of thousands of people make it possible for this program to exist. It creates a win/win/win opportunity in a kind of "economic justice" framework.

Sustainable Society Leaders are the emerging new school of leaders looking for new and creative ways to bring sustainable, civil, just and personally empowering ways to our society and the environment. I'm thinking that the Groupon model provides a template for some creative leadership structures that would pass the sustainability smell test. The internet makes it all possible. Here are some ideas SSL's may want to consider...

Business Social Action Rider: What would happen if businesses were asked to provide a portion of their profits automatically to the social justice cause of their choice, and those social justice cause organizations were asked to provide on-site and web based promotions for those businesses and their products? I've implemented this structure in the sale of my books. For each book sold, $2 from each sale goes into a pool to purchase natural and organic foods at cost. Then, I have that organic food donated to homeless shelters around the country. The idea is that if we feed homeless people better food on the front end, it would improve their health instead of giving them fatty, sugary, unhealthy food that would further tax their compromised immune systems.

This, of course, would reduce the number of homeless people who end up in emergency rooms at hospitals, costing taxpayers up to $50,000 a year, per homeless person. Thus, the homeless, the shelters, the place I buy the organic foods from and the tax payers win. Not to mention, I sell a few more books. This process integrates profit with social action as the way it should be. Where we've run into trouble as a society is separating the two so that they are at odds with each other. The time has come for the end to that destructive conventional wisdom.

Global Farmer's Market: The challenge many backyard farmers face is that they grow enough for themselves, but they have plenty of surplus they'd like to get to market and earn a few extra dollars. What would happen if a group of these backyard farmers pooled their surplus together and started connecting with other small communities that would purchase their items directly? Perhaps a community group in the Netherlands could connect with a group of yam growers in Southern Uganda for their yams, or a neighborhood of backyard farmers near Omaha, Nebraska could connect with strawberry growers in Argentina for their seasonal product? It would create a global network of free enterprise entrepreneurs, maintain the integrity of their organic products and create international friendships at the same time. This idea wouldn't replace the modern system of food distribution, but it would create an alternative one that may be more in keeping with sustainability practices.

Green Business Investors: The Groupon model provides a way for qualified Green businesses to find individual investors for their products or services. In a kind of "deal of the day", consumers can get a short pro forma of that company and the opportunity to buy individual stock in it. Think of it as a kind of consumer-based public offering that's not just restricted to well-healed investors, but everyone who gets the notices. The qualified and participating business benefits from getting the investors it needs to expand services, the investor benefits by being able to participate on the ground floor of a quality venture, and sustainability practices get a shot in the arm when other businesses notice those companies who are thinking about our long-term survivability as a planet are getting preferential treatment.

Okay, maybe these ideas need some development work, but that's just the point. The Sustainable Society Leader must think of new and innovative ways of integrating our society so that all aspects of what we do are thinking about our long-term existence. This is not thinking 'outside of the box', because there is no box. Whatever we create need not have old school references such as 'the box' we once used. These are new ways of looking and old problems and nothing is off the table, including the innovative success of Groupon.

If Sustainable Society Leaders don't do this kind of wide open thinking, who will?

By Chet W. Sisk

The Future of Travel Membership Sites in the Wake of Groupon

For the last few months I, along with every other consumer out there (except of course the big wig Wall Street MBA's or shall we call them mystics) have been wondering how in the world Groupon is worth billions of dollars. The truth is that it does not matter. The powers that be say they are worth a gazillion dollars and so they are. And there is where the fun begins.

Despite the fact that we all know that Groupon' model is like a speed of light derailed train, we all want in. Better yet, we want our own speed of light derailed trains on the track. And so the travel industry has taken note and is building a train of their own offering Groupon like deals on member only websites such as, and Haunte look. This could not have happened at a better time. If the trend is correct then consumers who purchase luxury goods, still worried about the economy and itching to travel want to find the best deal possible. Maybe it is psychological-obviously the kind of person who purchases luxury items even at a discount is not that worried about the economy.

Perhaps it is just that great feeling we get when we think we got a great bargain. Whatever the reason more and more people are signing up to these member only bargain websites and more often than not the site will also offer travel deals in the mix. The question is are these travel deals selling? Or are these travel deals just window dressing to create the look and feel of the lifestyle that the consumers who sign up for these sites, are or would like to think they are a part of? More precisely are these member only luxury good sites the best vehicle to use in order to get on the Groupon trillion dollar track? Maybe.

The Groupon model is simple: local merchants go to the Groupon website and request to be featured as a deal in their local market. Groupon has a rep contact the merchant to workout the details of the deal, such as retail cost discount etc. At the end of the day when the merchant is featured, and enough people buy the deal for it to be "on" Groupon gets 50% of the revenue generated, the merchant gets a check for the other 50%,and the consumer gets a great bargain. Everybody wins right? Not so fast. The merchant now has to honor the Groupon deal which means they better have done their homework! Remember, Groupon keeps 50% of the already discounted revenue. So now the merchant is left with a consumer who is receiving goods or services for a fraction of the cost. That consumer better come back and pay full price a few times or purchase something else at full cost when they use that Groupon. Otherwise more often than not everyone wins except the merchant. If that is the model that everyone is rushing to emulate then take caution: merchants will not run deals again if all they are doing is losing money.

So what does all of this have to do with luxury goods membership sites and travel. As a humble observer and one who is very familiar with the margins that we all live and die by in the travel industry, let us all pay attention to those margins as we hop on these luxury goods member only sites. Yes, they have millions of free subscribers that buy expense stuff at a discount. Yes those subscribers may or may not be interested in travel. But those subscribers are more expensive to woe, even more expensive to retain and require more attention than your average Joe on Expedia.

The bottom line is that all this window dressing from product, to copy and retention both pre and post sale will have an effect on the bottom line and should be carefully considered before getting to the train station never mind hoping on the train. There are those who are banking on just creating value by distinction such as, the idea being that that will be enough to separate themselves from the commoditized OTA world. I humbly disagree.

The truth is that no matter what travel deal I am offered on an exclusive member site as a consumer I am going to check the validity of the claimed discount by going on the hotel site and then an OTA. Unless I am receiving some other quantifiable value I will still book with the cheaper of the three. Sound like just another commodity with lots of bows? You bet it is! That is unless these member only sites find a way to offer some perceived value to the travel consumer that will raise their conversion. I guess we will wait and see.

Groupon - My Purchases and Experience With Groupon

An exciting new way to save money online and find deals in your area is through Groupon. When the daily deals site first came out, it was getting a lot of exposure, but not more than ever. Whether you are in California, or Nebraska, there are many new daily deals becoming available each day.

In addition to Groupon, there are also many other competitors such as Living Social and Gilt City. Living Social has done an amazing job promoting and branding their company through television commercials. While other competitors and brands are doing extremely well in the iPhone and smart phone app space. The majority of these daily deals web sites have mobile phone apps, which make it easy for you to buy an exclusive coupon or discount, then hand your phone to the cash registrar at check out.

During my time with Groupon, I've been able to find some really great deals that have been useful in my area. Here are just a few of them.

Barnes and Noble Groupon

Finding a Groupon or coupon for any major outlet and brand is always a great benefit. Barnes and Noble was one of the first big chains to offer a Groupon in my area. This promotion was good for a $20 for only a $10 purchase.

Old Navy & Chili's Groupons

Just like Barnes and Noble, I recent had a chance to try Old Navy and Chili's promotions when they used Groupon. Just like the Barnes and Noble promotion, these were both a $20 for $10 coupon.

Trump Plaza Groupon

My last purchase with Groupon was for a Trump Plaza promotion, which was for a two night stay and extra bonuses such as spa and breakfast services. Unfortunately they were booked and I had to refund Groupon, but it all worked out in the end.

As mentioned in the last promotion I took part in, even though I purchased the promotion for around $149, Trump recommended I call Groupon to have my purchase refunded. I was ready for a battle, but when I talked to the Groupon customer support, they actually made the process very easy and simple. This was a great thing to see, as many companies lack in the customer support area

While daily deal sites are still growing, they will continue to bring in new customers and promotion for small businesses in your area, and well known brands as well.

One of the major problems the advertisers and daily deals business must focus on, is the ability to have a customer purchase more than the minimum required of their coupon. Early statistics have shown that around 50% of the current advertisers of daily deal sites are not that excited about their results and would likely not run another promotion.