Doing Business with Groupon? Yes, but on the condition that…

[mdabuhasan]

Groupon is one of the giants of couponing: companies and professionals offer discount coupons to users with the hope of finding them as customers over time. The idea is interesting but hides some pitfalls. Let's try to discover them together.
TABLE OF CONTENTS
How to make the most of Groupon.
How Groupon Works
Typical Groupon Customer
The most common mistakes
4 Tips for Using Groupon to Keep Customers Coming Back.
Bonus tip.
DISCLAIMER.
Groupon coupon offers

How to make the most of Groupon.
Groupon has expanded the way many small business owners do business since late 2008, quickly becoming the world leader in group purchasing by allowing users to take advantage of discount coupons at local businesses and activities.

Arrived in Italy in 2010, it is now a widely used channel to take advantage of travel, dinners and services at very high discounts. Groupon has thus revolutionized sales dynamics because it offers companies visibility to acquire new customers and great savings to users who use discount coupons.

How Groupon Works
50% off coupon offer

Merchants or professionals offer discounts of at least 50% on the whatsapp number list
list price in order to attract customers. Localization and platform do the rest. The idea works because everyone (or almost everyone) likes to save when possible. For less than €30 you can find candlelit dinners, teeth cleaning or a boiler overhaul that at full price would cost at least double.
The system therefore, with its ups and downs brings customers to those who use it, but unfortunately not everyone knows how to make the most of it. Let's try to find out why.

Typical Groupon Customer
The typical customer of this platform is generally distinguished by at least one of the following characteristics:

Careful: it is constantly looking for the lowest price
Wanderer: Wants to find new products or services to learn about
Bold: buy blindly hoping that the price is inversely proportional to the quality
The typical Groupon customer is not easy to retain and retain in the long term. The fact that he buys a service at at least half the price makes him still wary of returning and buying at full price.

Entrepreneurs who decide to invest in this marketing model must take into account the 3 different situations described above and act accordingly in order to maximize their return. How to do it? We'll talk about it later.

The most common mistakes
The type of business with Groupon forces you to reduce the price by at least 50%. But as we know, many people, in order to acquire a new customer, reduce the price to the bone, so in order to be even more competitive, they sell with discounts of even 70-80% on the list price.

Unfortunately, too high discounts bring with them 3 big disadvantages:

Loss of product value. With a 70% discount, the full price would be too high for anyone.
The coupon price becomes the reference in the user's mind from which it is difficult to deviate much.
If price has been your best differentiating weapon, it is difficult to think that a customer will return by paying the full price. For example, a customer who buys a dinner for 4 people at €65 instead of €200 is unlikely to return if forced to pay 3 times the price of the coupon.
Groupon customers

4 Tips for Using Groupon to Keep Customers Coming Back.
The use of these couponing systems is fascinating because the discount, the offer, the freebie attracts many customers. Entrepreneurs therefore invest in services (almost) at “below cost” in order to acquire customers and keep them in the future.

For the reasons described above it is not so easy to keep the customer so my personal suggestions are:

Avoid disproportionate offers by only entering coupons with the minimum discount (50%). In this way the perceived value of the product is not excessively reduced.
Offer second-tier products too . You will still increase the visibility of your business and you will be able to sell your bestsellers through cross-selling techniques .
Create loyalty programs and offers to sell directly through systems other than Groupon ( at zero commissions ). In this way you will be able to “educate” the customer at prices that are higher than the coupon prices but lower than the “full price” so as to attract them again and subsequently consolidate them.
Maintain direct contact with the customer also in the future through the use of “all in one” tools such as mobile applications ( more info here ) or by subscribing to your newsletter .
Bonus tip.
This is a general tip for all marketing activities: test, tweak, improve.

Set up your marketing activity according to these 3 points:

Objective
Strategy
Instruments
and then, once you have decided on the tools you want to use, check if you can integrate them with others to increase the potential and effectiveness of your marketing.

You will see that with a correct analysis and various tests you will discover new virtuous systems that can help you obtain very flattering results and that perhaps also require lower investments.

If you need a quick consultation, contact us without obligation .