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Social Media Shopping Deals Space Goes Self-Serve With Groupon?

On the heels of posting "Social Media Deals Space Goes Ape with JungleCents" and the already crowded space of online shopping deal sites, Groupon is said to be launching its latest feature called Groupon Stores - an option that will allow businesses to created Facebook-like self-serve pages where fans and friends can follow and access discounted deals from a specific brand.

With a six-month backlog of merchants requesting to be featured on Groupon, it isn't any wonder why the self-serve option might become a reality. According to the yipit blog that uncovered this, only one in seven businesses that apply to offer Groupon deals are accepted even though Groupon now offers several deals at once in some of its bigger cities.While there is not a lot of hype regarding the feature on the Groupon site, there is a lot of conjecture and speculation as to how it will widen Groupon's customer base.


Since Groupon is typically thought of as a new customer acquisition channel, where businesses pay in significant discounts and commissions to attract new customers, a do-it-yourself feature would allow brands to convince their current customer base to come back and spend more.

Groupon's FOLLOW button is similar to Facebook's LIKE icon. This allows users to indicate they would like to learn more about additional offers from any one business. Receiving offers is already one of the reasons consumers follow Facebook fan pages and Twitter Promoted Deals  - so it perfectly suited for Groupon Stores to use to keep in front of their customers.

One risk that Groupon Stores might face is being perceived as 'discount' merchants only. Customers that shop exclusively based on price are not usually a brand's strongest promoters. Since they are motivated primarily by deals, Groupon Stores could create 'buying wars' with stores undercutting the cost of the same or similar product offered at several Groupon Stores.

Dissimilar, Facebook pages allows a brand a broader promotional platform. Instead of just appealing to consumers that are strictly price-driven, its an opportunity to engage and accept user-generated content, handle customer-service issues, introduce new products and issue branding messages that can sell products based on features and benefits versus price-only.

Also Groupon's initial business model was predicated on 'exclusivity.' By opening themselves up to more and more deals, Groupon Stores could actually work against it's original. When discounts are available to 'all' versus the first that respond, I believe there might be some backlash and drop-off from new customers that have a lot of other choices now in this space. With Woot, Gilt Groupe, RetailMeNot and JungleCents vying for the same customers, Groupon could lose marketshare from 'new' customers.

When any one site begins to feel that they can be all things to all people, they lose some of their cache. Facebook to date has been successful in this respect, but even at 500+ million strong, they have initiated some programs and campaigns that have fallen into the same trap (for related post, see "Social Media Privacy Leaks Creates More Detractors Than Promoters For Facebook").

However, until a formal announcement is made by Groupon pertaining to expanding the Groupon Stores feature across its entire Web site versus just a few cities (presently it looks like Chicago may be a test city), it is purely speculation on our part, whether or not they will revise their original model - and be successful at it!

Comments
Oct 24, 2010
by Anonymous

Word to the wise

My experience with Groupon has been bitter sweet. The Groupon offers I have experienced require you to buy items in advance at highly discounted prices. In one case the store went out of business before the cupon could be exercised and in another the store refused to accept the cupon, stating that they no longer participated in that program.

Best to check out the establishment ahead of time and decide if you want to take a chance or not.

George Ellson
www.quality-discounts.net

Oct 25, 2010
by Anonymous

@ George

Hi, what happened to your vouchers? Were refunded by Groupon? what happens when the store is out of business? Thanks, Ana

Oct 25, 2010
by Anonymous

GroupOn on the Go!

GroupOn is always on the go with resourcefulness. It always has new strategies on how to convince so many people to use their site when it comes to deals. Therefore, it is not a surprise that GroupOn is also found in one website that has deal sites listed all in one - www.GroupBuyUnited.com.