The group buying craze sure came to light in 2010 with a number of providers following Groupon’s lead including Living Social,etc in the U.S. and Scoopon, Cudo and Spreets in Australia. The sites have provided us with a renewed focus on local business and for me, being an advocate for local business it is encouraging. However the problem that this presents, is that the focus is on price, and this can be a dangerous game for small business.
But do not take this as a warning to avoid the opportunity, simply it is a warning to take particular steps to utilise the opportunity and maximise the benefit to your business in the long-term. For if this is going to provide a successful outcome it will be because you have been able to encourage these new customers to return to your business.
So here are my 5 simple ideas to follow when promoting your business deal to the group-buying community.
Limit offer to a slow trading day
Whilst all coupon-bearing customers should be treated as well as anyone, they are purchasing with one motive in mind and that is value. So stipulate that the coupon can be used only during slow periods. So for example, if you’re offering a restaurant deal exclude the busy periods of Friday and Saturday evening. This way you will be filling up the restaurant when it’s slow and you won’t have to turn away full-paying customers. What a great way to make your business look busy during the week and we know people talk about that.
Make them part of your social community
I’ve heard all sorts of figures put on the value of a Facebook or Twitter follower. Whatever the value, they’re all important for our business and our brand. Some of us are even spending money on advertising to get more of them. So why not use this group-buying opportunity to gain more Facebook ‘likes’ or Twitter ‘followers’. Perhaps the coupon can offer a deal where you offer a little extra if the consumer has joined your social network. This may come in the form of another discount that can be passed on to be used on the next visit.
Get their Email Address or Mobile Number
There have been some astronomical numbers purchasing the group-buying deals, but on average there seems to be anywhere between 500 and 2,000 people buying the deals on my local sites. Are you going to let them come into your business, use their coupon, then leave and never come back? I have used a few coupons as a way of trying new restaurants and have yet to go back to any of them. Not because I’m tight but because there are so many dining options and hey I forget about them. So if you don’t already have an email or mobile database of your customers then start one before you go into the group deal. The database can be used to keep them up to date with news on your business or used as a tool to distribute discounts and more coupons.
I’ve mentioned a few times in my posts about the importance of encouraging online reviews. We are if you haven’t noticed in an age where we have fortunately gone back to valuing peer reviews and opinions, over what a television or print advertisement tells us. This combined with the ability that technology provides, presents a fantastic opportunity for local business. So do what you can to get the coupon-bearing customers to leave online reviews at your Google Places listing, on your Facebook page, your Foursquare listing, etc. One customers glowing comment may in-turn encourage a further 5, 10 or 100 customers to your business.
Customer Service is still Key
If the venture is successful for your business, in that you sell more coupons than expected, then you will at some stage (more than likely) feel resentment towards some of these customers. But forget about the margins, think of them as full-paying customers and that you have just underwent a hugely successful advertising campaign that has resulted in attracting large numbers to your business. Remember, the key in utilising these opportunities is to make sure that they return. If your customer service wanes then they will not return, they will not leave a review, they will not tell their friends, and you have just wasted that advertising money.
Seriously, the group-buying craze is only going to get bigger as the late-adopters start picking up the opportunity. So take it seriously, this could be a great move for your small business. Just make sure you do your figures, if it costs you $2,000 and you attract 1,000 people to your business weight it up with your other marketing activities. How many customers can you definitively say your local newspaper advertising is attracting? Did you get 1,000 customers come in when you did that flyer drop?
So if the figures work and you want to go ahead please take into account my ideas, if not then at least have one thing in the back of your mind ‘How can we encourage these people to come back?’.