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The Social Coupon Game- You’re Doing It Wrong

July 12, 2011

I had the pleasure of meeting with some other Social Media folks here in Atlanta a few weeks back. These meetings usually consists of us chatting about social happenings, comparing notes and general networking between people who work in the social world day in and day out. They are a great way to get your head out of the sand and chat with people who really care and appreciate what social is doing for businesses. During our group discussion we got on the topic of social deals and coupon sites. The topic turned into an hour long discussion of what we like and don’t like about all the top social coupon sites. While we all realize that sites like Groupon, Scoutmob, Living Social and others are the evolution of coupons, we found that some clearly outperformed others.

The main differentiator wasn’t the deals, the UX of the app or the frequency in which deals were served. The main issue for most people in the room was the execution of the deal by the establishments using the service. Participating companies pay a large percentage (usually around 50%) of these sales back to the coupon sites. Only to botch these offers more often than not. I can’t tell you how many Groupon offers I’ve used where the person completing the transaction had no idea what I was talking about. Same goes for the one-off FourSquare deals that I take advantage of from time to time. If you’re going to spend the money to lure me in and get me to try something outside of my normal day-to-day, then why not put some emphasis and education into the execution of the promotion? Seriously, you wouldn’t spend a hundred thousand on a direct mail piece only to not inform your cashiers of the promotion, would you? Well, this is no different. Now that you’ve got me here, give me a reason to come back. If nothing else, don’t give me a reason NOT to come back.

In regards to poor customer service, satisfactions, etc, the responsibility will first and foremost fall on the respective businesses and employees, but I believe this isn’t all their fault. The coupon providers are also responsible. Here’s some food for thought for the social coupon companies of the world. Your app/site is only as good as the businesses that execute your offers. If they can’t execute it reflects not only on them, but you also. That’s right. You’re also responsible for my poor experience and you will lose me as a customer forever if your partners can’t deliver. Bad experience with a Groupon offer, no problem. I’ll scrap my Groupon app and move to the 20 other free social coupon apps. You’re not the only game in town offering 50% off horseback lessons every other week.

During our conversation, Scoutmob was repeatedly mentioned as one of the companies doing it right. They seem to have a level of interaction and training associated with their business partners. The key to a program like this is education. The social coupon game is still relatively new and the mainstream public hasn’t caught on. The people working for a participating business may very well be the last people to use a site or app like this. That’s fine, given they understand the program and its specifics. Nothing aggravates me worse about these deals then when I go to use one, after already paying for it and I get the. “I’ll have to ask the manager about this” or even worse, “Can I take your phone to the manager and show her?” Yes, that’s happened.

To the Groupons and LivingSocials of the world please take this bit of free advice. Invest in your business partners, because if you don’t, you will not succeed.

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One Comment
  1. You’re right on, Ryan.

    I read an article recently about Groupon and small business. A spokesperson from Groupon said, “It’s easy to say you want 10,000 new customers, but be honest with yourself and what you can handle, because that is sometimes where people get tripped up.”

    They place the sole burden of success on the business. How much better if Groupon (and others) would say, “We want your deal to be successful because if you’re successful you will use us again. We will evaluate your business and make recommendations to be successful when running a deal on our site.”

    It would be an added burden on the sites, but surely they could make a service like that profitable…

    These deals sites do a lot of research into their customers for marketing purposes (i.e. how many people buy and redeem, how many businesses run more than 1 deal per year, etc.). I would roll out a business evaluation/consulting service then survey the hell out of it to see which businesses that use the service end up with a bigger customer base (vs people coming in once to redeem the deal then never showing up again).

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