The Golden Age of Groupon is upon us…
The question is, for how long?
Comments section skeptics aside, businesses across Kansas City have taken advantage of Groupon’s email blast, deal-of-the-day marketing propostions. It’s not about undermining the value of a product by giving away the farm for half price. In less than two years here, Groupon’s forged the image as a proven means of reaching hundreds of thousands of locals with offers they can’t resist. Offers that work for both the biz and the customer.
It’s that simple.
However we may be nearing the turning point.
As in too much of a good thing.
"A guy from the Star called and they’re trying to do it now," says Jardine‘s jazz club owner Beena Brandsgard. "They’re going to launch a separate thing in May. He said there were like 17 of them out there now."
Who isn’t out trying to con businesses into selling stuff for half off and giving them a piece of the action?
There’s Lucky Monkey, Muncharoo – even a company called Hello GoodBuy! The former owners of the Pitch were hatching a half-off scam. What Groupon unleashed and perfected, every goofy-sounding wannabe in the book is now out there trying to imitate. And to some extent it’s an easy sell. Or at least it has been.
No out of pocket for the advertiser, just give the customer half off and the marketing company half of the other half.
Or maybe a little less.
"It’s even shifting as we speak," says one local marketing firm exec with extensive experience with Groupon. "You get six deals now instead of just one with Groupon. So the format of one deal a day is changing already."
Even some companies that have had excellent experiences with Groupon are rethinking the proposition.
"Now that the economy is improving, a lot of people are just saying, ‘I don’t want to do any discounting,’ " the marketer says. "And because there is so much competition now, Groupon is doing six deals at a time and they’re going to run out of businesses. Because you really only should do one or two of these maximum per year."
As for local immitators, "I would think that Muncharoo or Lucky Monkey are going to be calling people who have already done a Groupon and they’re going to say, no thanks. People who have tried Groupon and who aren’t about to do a lesser service than Groupon and get an even lesser response."
Speaking of which, size does matter in the world of email blast discounting…
Somebody at Groupon screwed up and sent Jardine’s March Groupon deal to only 15,000 emails instead of 150,000, Brandsgard says, So instead of the 1,600 or so deals she got the first time out, Jardine’s got only 200 takers and change. To make up the difference, Groupon sent out another Jardine’s blast this week.
Back to the competition…
Given a choice between Muncharoo or Lucky Monkey and Groupon, "I’m going to do the sure deal," the local marketer says. "Why would I go with 30,000 (emails) instead of 300,000 with Groupon? And Groupon is starting to discount deals like the smaller players. I just can’t see how people like Muncharoo can get a meeting with a business because in all probability somebody at Groupon has called just about every good business here – Groupon’s poring over everything.
"So if somebody was going to do a deal, they’ve (probably) already talked to Groupon unless they didn’t call Groupon back. Maybe there are enough new businesses or businesses Groupon doesn’t want to deal with to keep some of these (imitators) going. But I wouldn’t want to be one of the companies selling against Groupon."