Groupon has seen explosive growth and has a chance to generate a billion dollars in revenue faster than any other company in history (Priceline.com is the current record holder). IDEO‘s Colin Raney has pointed out a few areas of weakness in the product design, namely how Groupon isn’t really providing consumer driven deals at all, but their financial success is remarkable.
The Groupon story is even more impressive considering how many rules of the web they break. Groupon is:
Anti-Customization – One deal a day with no automated upsell or attempt to increase inventory. Groupon is starting to offer personalized deals, but it is still primarily a “take it or leave it” proposition.
Anti-Social – You can’t friend anyone or favorite anything. There are the obligatory Facebook “Like” button and “Tweet This” badge, but nothing baked into the service. In the early days the system encouraged you to email friends to make the “group coupon” happen, but with the current scale it is no longer needed.
Anti-Posterity - Groupon’s page structure is great from an SEO POV, but none of the old deals are actionable. There is no long tail or back catalog. The site is digital ephemera akin to a printed “Penny Saver” (Albeit one with fun copy).
Anti-Targeted – At least with their advertising. The beauty of web advertising is the ability to target ads to a geographic area or keyword. Groupon ignores these capabilities and instead serves millions of ads featuring macaroons.
Groupon’s focus on French Macaroons seems successful and has spurred competitor Living Social to follow suit, targeting a lower rung of the confectionary ladder with the lowly glazed donut.
This advertising strategy strikes as a little odd. Most of Groupon/Living Social’s offerings are for restaurants, spas, or pricey attractions. There is certainly a connection between high end food and dessert, but is a coupon for a product that costs $0.89 intuitive? Considering the core value of both services is the diversity of offerings, why does monolithic ad creative work?
Is this omnipresent ad campaign the result of A/B testing showing a preference for sweet imagery? Or is it that for all the talk about customization, there are certain symbols and cultural meanings that resonate at a higher level.
Or is it simply that the ads suggest “inexpensive indulgence” which is exactly what Groupon et al. are selling. In any case, time is running out on the deal of the day, care to join my group?