Is Groupon The Right Fit For Your Business?
Coupons are not a new concept. Chances are your family has been saving money for years by cutting out coupons from flyers and as the times changed, printing them from the internet. The truth is, everyone loves to save money and Groupon’s business is built around the public’s desire for a good deal. Group buying has recently become a growing phenomenon. As consumers begin to realize the benefits, businesses are jumping on the bandwagon to offer whatever deals they can.
Each day, Groupon offers a new deal on food, retail merchandise, or experiences in your city. As a user you can purchase these deals online or through their mobile app. Each deal requires a certain number of users to purchase before it “tips” and becomes active. This ensures that businesses participating get the desired minimum amount of users to purchase. Businesses can also set limits in terms of how many coupons are available for purchase, when they expire, how they can be used etc.
The important thing to remember is that while Groupon is a great business with a great concept, it may not be the best fit for you. There are many factors that come into play when organizing a deal through Groupon and as a business, it’s vital that you’re prepared in advanced.
Can You Afford To Offer The Discount?
The first step in determining if Groupon will work for your business is to start crunching some numbers and learning more about how the process works. Upon investigation, businesses will learn that Groupon typically takes 50% of sales. If your business sells 1000 Groupons for $15 each that’s $15,000 in total so Groupon gets $7,500 and you get the other $7,500. If those 1000 people all come into your business and spend exactly $15, you’re left with no other profit whereas those who come in and spend more than the allotted $15, put that money directly into your pocket. It’s very important to figure out how much your business can sacrifice financially in order to really leverage a group buying deal.
How Will You Handle The Traffic?
Are You Prepared To Track Redemptions?
Once your business has made its appearance on Groupon and customers have purchased the deal, it’s your turn to take over the reins. Each Groupon is only redeemable once, so when the barcode is scanned, the customer forfeits the coupon to the business. The process of tracking redemptions can prove very useful. As a business owner it ensures that you’re aware of how many Groupons have been redeemed so you can plan ahead. Tracking Groupon redemptions helps you stay on top of things and ensure the process runs smoothly. What many businesses fail to realize is that tracking these coupons can provide them with loads of interesting information in terms of buying habits. How much did these Groupon customers spend? When did they redeem the coupons? Did they buy any additional as gifts?
Have You Educated Your Staff and Created a Game Plan?
You’re potentially bringing in new customers with Groupon and you want their first impression to be amazing so they’re enticed to return without a coupon in the future. Ensuring that your staff is educated and prepared to handle Groupons can make all the difference. Do you know how the staff will ring up the deal on the cash register? Do your employees know how to properly track the incoming Groupons? There are many bases that beed to be covered to provide the best user experience possible but preparing things in advance and staying organized can help the process run smoothly.
Have You Done Your Research?
Researching Groupon’s services and reading business case studies can really help steer you in the right direction. It’s important to remember that there are many responsibilities and risks involved with group buying deals, as there are with almost any aspect of marketing. At the end of the day, it all comes down to making an informed decision so you can ensure that your business will be prepared to take advantage of everything Groupon has to offer.