Yipit has posted about some of the details surrounding the new Groupon Stores self-service SMB-CRM product. It occurs to me that this was eBay’s opportunity years ago but it failed to really execute in local. Now the company has ceded the opportunity to others like Groupon. (eBay has a deal with Groupon in fact.)
Groupon Stores are equally about new customer acquisition and CRM. You can apply to be the deal of the day, with the typical merchant and Groupon percentages. If you simply do promotions through the Stores functionality you keep more of the value of the deal. In addition merchants are permitted to run deals as often as they like.
Here are the FAQs:
While merchants have had their gripes about Groupon, the model (a percentage of the value of a transaction) is the preferred “advertising” model among a large number of SMBs.
Related: Yahoo starts embedding Groupon code in global distribution deal
October 29th, 2010 at 4:40 pm
Hey Greg. This is a powerful concept that I think is hot. The internet is loaded with the “soccer mom” coupon loving demographic . These “mom” type people also control the share of the family wallet. Companies that are capitalizing on this market = smart while providing a valuable service to it’s consumers. There is no better way to build a brand and customer loyalty. I know Groupon still has some with to do with the merchants but this new tactic is pretty impressive.
October 29th, 2010 at 5:58 pm
Jennifer:
I agree that the “mom” segment is critical and that they love deals. And I agree that groupon has build something powerful here.
Online and in mobile there’s more gender balance and men are also quite interested in saving money and finding deals.
November 1st, 2010 at 11:18 am
I am not sure this scales as well as it looks.
Selling to small businesses is very hard. The yellow pages (I’ll use the UK version as the benchmark) has a huge number of sales people both on the phone and walking the streets. The also have a well honed “on ramp” i.e. their ability to source, engage and up sell buyers.
YP has been struggling for years to create a self serve model without any luck. Google’s revenues from small business are a very small percentage of their total revenues (and slipping) and, again, they have been trying for years to nail a sales process and product that appeals to small business owners.
YP’s issues to date has been that Google has taken local search away from them. By copying the Groupon model with some good execution it may be the case they can use existing assets and brand awareness to nail this market before Groupon builds a mass market brand. Groupon has no secret sauce, no algorithm or scaled technology which acts as a barrier to entry.
The almighty caveat emptor here is YP would have to: i) move quickly and; ii) execute well. To date both of these skills have been somewhat absent. Witness UGC and the Yelp phenomenon.
November 1st, 2010 at 11:27 am
Another factor that creates obstacles to self-service is “noise” or confusion in the market. If there were one or two definitive “solutions” vs. a growing number of options and choices self-service would be an easier objective. Regardless for the near term it’s still only for a small segment of the SMB population.
November 8th, 2010 at 8:58 am
[...] written a couple of times briefly about Groupon Stores, which is an attempt to broaden out Groupon’s utility to merchants. At a certain point, [...]
November 30th, 2010 at 12:39 pm
[...] year the market could look quite different than it does today. Groupon is evolving of course (e.g., Groupon Stores) but consumers and SMBs could certainly cool to “daily deals,” though consumers will [...]
December 1st, 2010 at 3:24 pm
[...] is merely a formal discussion of the recently launched self-service option but deal feed allows users to receive more deals per [...]
July 11th, 2011 at 12:26 pm
[...] here and plenty of other companies are doing a version of SMB/mobile loyalty. For example, Groupon aspires to be a CRM platform (eventually). Startup Closely offers an interesting spin on loyalty that can involve physical cards [...]