4 ms·

That explains Groupons quite well.

• tptacek 15y ago
  That's the point of Groupons: to buy first customer visits with below-cost products, instead of throwing money away in newspaper ads. He's not saying selling below cost is a discredited tactic. He's saying it's a discredited strategy. He's not saying selling below cost means there's no market. He's saying it doesn't tell you what the market is. If you're selling cupcakes, you need to go to Groupon knowing your cupcakes are good enough, and that there's sufficient demand, to clear in the market. Then it makes sense to spend resources to promote your business so that people are aware of your cupcakes. Groupon might be a pretty good illustration of the perils of confusing awareness marketing with demand generation.