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I was curious a bit back how successful Groupon promotions actually are -- i.e. if there's actually significant value being created or if they were just moving

by wheels 16y ago

I was curious a bit back how successful Groupon promotions actually are -- i.e. if there's actually significant value being created or if they were just moving from one burn to the next based on hype. Turns out for 66% of customers it does pan out. Here's the study: http://www.ruf.rice.edu/~dholakia/Groupon%20Effectiveness%20Study,%20Sep%2028%202010.pdf http://www.ruf.rice.edu/~dholakia/Groupon%20Effectiveness%20... I'm glad to hear that they're planning on pulling together ROI management and more general metrics stuff for small businesses. I've thought for a while that was the natural direction for them to run. Small businesses are usually experts in their product domain, but are often lacking in the more traditional business skills.

webwright 16y ago
Whoa-- I think you're misreading the study. To quote: "So were Groupon promotions profitable for our respondents? Yes, they were, for about two thirds (or 66%) of our respondents. However, a significant number in our study, 48(or 32%) reported their Groupon promotion was not profitable." It's important to note that this is a SURVEY-- I'd wager most small businesses have no way of tracking the marketing impact of a Groupon (i.e. how many people come from 2nd visits or word of mouth from Grouponeers). Interestingly-- the survey also asked how people of the merchants would use Groupon again and how many would recommend it to another merchant. 42% said they wouldn't use Groupon again-- so they definitely have some challenges.
- phlux 16y ago
  >...I'd wager most small businesses have no way of tracking the marketing impact of a Groupon (i.e. how many people come from 2nd visits or word of mouth from Grouponers).... Aren't there ways to solve this; e.g. change the name/sku/price/etc of the item you are selling through a groupon. When it gets bought, referred to, asked for etc via the new tag-info you can relate it to the groupon? IANA sales/retailer etc... but I can imagine that you could figure this out. --- On another note; My friend owns a successful cup-cake shop in SF, groupon was asking them to sell what was typically a $36 box of cupcakes for $15 -- and then asking for 50% of the $15. So effectively sell the cupcakes for 25% of what they typically retail for. That just sounds like BS. -- however, as another HNer wrote earlier in this thread- this model works really well for things such as fitness - where your product is effectively just the groupon-buyer's attendance. I was talking with some people the other day and they said they bought some work-out boot-camp deal that was retailing for $600, for $200 and that was a good deal. I agree that it is a good deal - but it also proves to me that the $600 price point is way to freaking high...

by wheels 16y ago

webwright 16y ago

Whoa-- I think you're misreading the study. To quote: "So were Groupon promotions profitable for our respondents? Yes, they were, for about two thirds (or 66%) of our respondents. However, a significant number in our study, 48(or 32%) reported their Groupon promotion was not profitable." It's important to note that this is a SURVEY-- I'd wager most small businesses have no way of tracking the marketing impact of a Groupon (i.e. how many people come from 2nd visits or word of mouth from Grouponeers). Interestingly-- the survey also asked how people of the merchants would use Groupon again and how many would recommend it to another merchant. 42% said they wouldn't use Groupon again-- so they definitely have some challenges.

phlux 16y ago
>...I'd wager most small businesses have no way of tracking the marketing impact of a Groupon (i.e. how many people come from 2nd visits or word of mouth from Grouponers).... Aren't there ways to solve this; e.g. change the name/sku/price/etc of the item you are selling through a groupon. When it gets bought, referred to, asked for etc via the new tag-info you can relate it to the groupon? IANA sales/retailer etc... but I can imagine that you could figure this out. --- On another note; My friend owns a successful cup-cake shop in SF, groupon was asking them to sell what was typically a $36 box of cupcakes for $15 -- and then asking for 50% of the $15. So effectively sell the cupcakes for 25% of what they typically retail for. That just sounds like BS. -- however, as another HNer wrote earlier in this thread- this model works really well for things such as fitness - where your product is effectively just the groupon-buyer's attendance. I was talking with some people the other day and they said they bought some work-out boot-camp deal that was retailing for $600, for $200 and that was a good deal. I agree that it is a good deal - but it also proves to me that the $600 price point is way to freaking high...