“That’s just not the way I shop” and “I just don’t get it” are two recent comments made during two of my favorite podcasts, Inside PR and On the Record. So while Groupon continues to grow and attract new users, is there a bigger issue facing the company?
Judging by the numbers, a lot of people “get it” and are seeing value. Bloomberg Businessweek reports some astounding numbers in the March 21-27 issue: with 5,900 employees, they are set to make around $4 billion in revenue this year, and after rejecting Google’s $6 billion offer, they’re talking about an IPO that would translate to a valuation of $25 billion. And a lot of similar startups believe there’s room for more – since Groupon’s 2008 launch, more than 350 sites have entered the category.
My guess is that location and the success/failure of regional sales teams are a key reason people don’t have the same experience with Groupon. If the retailers in a certain area don’t participate – or the local Groupon sales team doesn’t attract a variety of interesting deals – then that region’s subscribers will likely see a steady stream of discounts on wax jobs and chicken wing specials.
While the one-hour Swedish massage offers aren’t for me, I have used Groupon for a number of relevant and valuable purchases. I bought a $30 round-trip bus ticket from Baltimore to New York City; paid $50 for $200 worth of eyewear plus an eye exam at a local optometrist; received half-off a pair of $80 running shoes; and paid just $29 for a three-month membership to a local health club. I also used a Groupon to cover part of a dinner at a local restaurant that I wanted to check out. The restaurant “deal” was $15 for a$30 coupon, so the math worked for me.
As for the complaint that it doesn’t lead to long term repeat customers, maybe there’s a reason. I’ll definitely use and recommend the Baltimore to New York bus service, I plan to continue using the health club, and the optometrist can count on me as a long-term patient. As for the restaurant? The dinner was O.K., but nothing about the place makes me want to return any time soon, so any expectation of repeat visits is their fault, not Groupon’s.