So admittedly this title is a little bit unfair, Obviously Groupon is still very much alive and it will probably be a hot stock when its recently filed for IPO hits the market in the near future, but it certainly will not be because I purchased it (nor would that make a significant effect).
In the wake of the announcement of their S-1 filing and their subsequent release of a balance sheet the blogosphere has been sent into a frenzy of “Why groupon is hemorrhaging money” and the like, so I thought I would take a different approach.
Instead of looking at how much Groupon is spending or where they could be saving or even analyzing their balance sheet at all I will make a humble suggestion that would get Groupon at LEAST one more customer (myself) and a chance at tapping markets they probably have not touched yet.
While the daily deal is a fun concept for many out there it doesn’t exactly work for a guy like me because I am not necessarily interested in what store in Shreveport, LA has cupcakes on sale today nor will I care about the offer of 20% off at Sephora next week.
BUT what if Groupon were to give me a simple survey upon signup, and (hopefully) even continue to just watch the kind of deals I have chosen to buy as a customer after I had already signed up and only sent me deals I would be interested in. Facebook has already proven that this method is effective in advertising, so why wouldn’t it work here?
I would love to know if Best Buy was offering a new plasma at 30% off or if a popular app is on sale in the “App store” (Dear Apple, App store IS a generic term, but please don’t sure me if you do not agree)
That’s actually the reason I subscribe to AppSumo and not Groupon. It’s because I want deals that are catered to ME not just anyone who lives in a 20 mile radius of the nearest tire store selling hubcaps for $25 off their usual price today.
There are several reasons I think this business model is better, but I’ll break it down into two fundamental purposes for this blog post.
1. More people are compelled to sign up if they are only getting deals that are truly relevant to them and not necessarily tied directly to their geographic region (lots of us like to travel, hell I’m sure cheap AA frequent flier miles would be a big ticket hit for a site like Groupon) it essentially allows them to reach each consumer with a more potent message, not just a “one size fits all” deal of the day.
2. It opens up to even more merchants who are probably less likely to use Groupon now because of this new found ability to provide specialized audiences. I am a geek, my friends are geeks and if I get a geeky deal of the day from groupon and post it on facebook my geeky friends are likely to follow my lead and do the same. (simple math, err reasoning, oh heck lets just call it common sense at work here) Not to mention it allows for multiple deals in every city each day opening up the already monumental revenue streams.
I’m sure this seems too simple to help to some people reading this post.
Andrew Mason may read this post one day and laugh while collecting the Billions of Dollars he is sure to be worth if Groupon’s success continues.
But its my opinion on the issue for what its worth and at face value. take it as just that.
At the end of the day I’m just one guy, raised in a middle class American family trying to slowly make my dent in the universe, this article probably won’t do that for me but maybe someone will take note and take my advice.
If there is one thing I have learned in business so far it is that there is only one way to acquire customers, And that way is one customer at a time, even if your business is Group Buying 🙂