It’s easy to take aim from the cheap seats…
There’s a growing divide between not just the old school media and the new, but those that perpetuate old school thinking when it comes to marketing and promotion.
Take the recent efforts by the KC Strip trolly system, the Royals and KU Football to market their wares on
smartman
Suggesting that Groupon works for many and not for some is a bit misleading. Does it work for 80% and not for the other 20%? What’s the real ratio?
There is a maxim in the ad business; “I know that 50% of my ad dollars are wasted, I just don’t know which 50%. That being said it’s reasonable to assume that HALF the advertisers on Groupon are pissing their money away and will never attain the brand managers dream of a “customer for life” that is willing to always pay a fair market price for their goods or services.
The better version of this, in my opinion, for blanc would be a loyalty program. Buy 4 burgers and get the fifth free. That way you are rewarding behavior instead of trying to influence it.
Discounting is an acceptable way to introduce a new product or service but using it as part of an ongoing campaign only serves to diminish the perceived value of what you are selling.
Will Gregory, “cutting edge PR Marketing maven”? That’s more of a
S T R E T C H than calling Stretch an “artist”. C’mon he doesn’t exactly have the bona fides of Donnie Deutch. The adman part of Donnie, not the wanna-be cable tv star. He’s not exactly Don Draper or Happy Meal creator and failed real estate mogul Bob Bernstein is he?
When I can get a deal on an F430, or lapdances, on Groupon I’ll become a convert. Until then it’s all smoke and mirrors and requires Enron style accounting or a complete suspension of belief in reality to suggest that this type of marketing is a strategic way to build a loyal customer base not to mention a profitable business.
The advertising industry employs more bullshitters and liars today than Washington, DC has in the past 200 years. Have we become so stupid that we actually purchase vehicles because Mike Rowe and Howie Long say so. Have Oxy-Clean sales dropped so much that they are invoking the name and image of Billy “the dead cokehead” Mays to pump up the volume?
Instead of taking Gregory’s word for what Ernesto said, why not confirm it with Ernesto?
I’ve also heard from someone who has worked for Groupon in sales that in order to keep their hype machine alive they will sweeten the split between Groupon and advertiser in order to keep people coming back. It’s a bit like a Ponzi scheme where the new advertisers get less of the split and the legacy guys get more so Groupon can say, “this works so good for Company X they just keep doing it over and over. No better way to justify your bad decision making then pointing to someone else’s.
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HC: Wow, such expertise! Get it out of your system? Ernesto likes it so much he’s writing a testimonial btw. Now a suggestion; do the math, blanc has.
bschloz
Pay to play promotion…KU gets to offload bloated tickets to Alumni and family’s that want to be in Lawrence on Sat. If it succeeds everyone wins. Only person that could possibly offend are season ticket holders who receive the email.
Great way to build trial…I see this as equivalent to a radio remote.
Markus Aurelius
Groupon rocks. There is no shame in using Groupon to market one’s product. It’s no different than the Royals offering their play-pack in April and May. If KU actually had a good football team or their fans were not so fair weather, then they wouldn’t need to use Groupon. However, their team and football fans suck and the AD needs to do whatever it can to put butts in the seats and maintain a sustainable revenue level. Personally, I hope KU resorts to Groupon for years and years to come.
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HC: KU football has and will continue to advertise it’s product, just like most businesses, thru good times and bad. With rare exception there are pretty much always going to be some seats available, especially for the lesser games. If they bring in some new faces from time to time, those people spend additional money at the game and have an enjoyable time, they just might be back. Maybe as season ticket holders.
Duh
I see more typos on this blog than anything else I read:
Groupon is merely a more modern marketing tool thgat works for many and not for some.
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HC: Thjanks!
kate krass
Hearne sometimes you really make me laugh out loud.
dp
First off, I love Groupon. I don’t like KU’s use of it for two reasons-
1. What does it say to the hardcore fans/boosters that already paid full price for their tickets? Isn’t offering discounted tickets on an email coupon an admission to the hardcore fans/boosters they paid above market value for their tickets?
2. Read the content of the ad. It makes no sense. Here’s an excerpt-
“When the Jayhawks are safely ahead, sing along to the ghostly chant of “Rock Chalk Jayhawk,” which awakens the fire-breathing jayhawk-monster from its slumber so that it may eat the opposing mascot.”
What? The fire-breathing jayhawk-monster? I have talked to a half dozen KU fans that are humiliated by the content of the Groupon ad, not that there was a Groupon ad.
kate krass
The Groupon Ad was for only two games. I bought a Groupon recently to a store that I had not stepped foot in about three years. With the Groupon I stopped by twice, used my Groupon and ended up spending twice as much as I would have if I didn’t have the Groupon. Marketing and advertising is about selling stuff. Groupon has a place along with tradtional advertising and branding.
As a matter of fact we should all support the wonderful advertisers on KCC, so we can all continue to enjoy the insightful, hard-hitting news we look forward to each day.
david
The most stunning thing about the KU groupon offer is the $80 regular price tickets for the game vs. Colorado.
TigerVIP
Perception is reality with Groupon and right now the perception amongst my colleagues and friends is that it does show desperation. That’s not to say it won’t change and at some point we may look at Groupon like radio or TV advertising. To many it looks like a quick cash grab. Yes it reaches a nice sized audience and promotes your brand but would you being offering those services so heavily discounted if things were going swimmingly? I would think not. Do the Red Sox offer groupon deals on baseball tix? Does Nebraska have a groupon special for football? Bottomline with KU is that if the product was better and the team was supported better there would not be a need to offer these specials nor would they. Simple supply and demand. Do you think the KU basketball team is going to offer a groupon? So yes in this case the reasoning behind them offering the tix is because they are failing and need immediate help. They are desperate to sell tickets.
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HC: You guys gotta do the math, look at the big picture. Focusing exclusively on the discount aspect is not the correct approach to analyzing Groupon. If you take a date to blanc order a $12 burger, sides and have a couple cocktails you are going to burn WAY more than the 10 bucks you saved on the coupon. The margins on food and booze are substantial. Why do you think restaurants like Cafe Trio trade out for their advertising bills when they can? The Groupon coupon expires, people move, forget about or lose them and the restaurant still keeps the $$$. Blanc says it got a very high percentage of new customers and a high percentage of Groupon coupon users have returned as repeat customers.
Scott B.
I just found out about Lucky Monkey that appears to be a Johnson County version of Groupon. I don’t work for them, but I’m getting my carpets cleaned because of them. 🙂
jjskck
The reason I don’t understand Blanc’s use of it is that they already seem packed to the gills without it. I think the idea of netting $5 on a $20 purchase when the house is already full of people willing to pay the whole $20 is why I’m confused.
david
jjskck – You need to consider the groupon offer like a gift certificate. Blanc gets the cash upfront from folks who may or may not use the groupon later. 14,000 $10 sales is a pretty nice chunk of change.
TigerVIP
David u forget that Groupon gets a cut of the 10 dollars. In many cases it’s 50%. So they need A LOT of no shows to counter the huge savings. But according to Hearne and others it’s not about the cash grab…honestly though the only reason to offer those discounts is to improve cash flow immediately. Thus it looks desperate.
david
which businesses aren’t desperate during these times?
eric
do you guys notice that groupon has dominated these posts? you tell me if it works, it got all of us talking about it…
eric
how much money do you think it would take to reach 100,000 people and guarantee 10,000 visits?
jl
What happened to Nikki already? She couldn’t take a little NY beating at the hands of KC’s finest?