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A Gut-Wrenching Groupon Blunder You Must Avoid

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Maybe you’ve heard about Groupon disasters. For example, an ad delivers an overwhelming flood of new customers but results in a net loss. That’s the gut-wrenching part. On the other hand, new people learn about your business. But your ad may attract only cherry-pickers — people who grab your great deal but never come back for more. So is Groupon worthwhile? As you’re about to find out, there’s a smarter play — and it’s an easy one.

My wife noticed a Groupon for a seafood restaurant. We both love seafood, and it looked like a great deal, so we grabbed it.

 

How did it go?

The restaurant was an easy 10-minute drive and had plenty of parking. The atmosphere was relaxed and pleasant. Quiet music played in the background. Our waitress was friendly and attentive. The menu had lots of appealing dishes, and the prices were reasonable. Our meal arrived promptly, and the food turned out to be delicious. We considered dessert… but we mustered our willpower and declined.

 

What did the restaurant accomplish?

For whatever reason, we haven’t been back. So it was a great dining experience for us, but for the restaurant… not so much. Why? To get our business, they had to offer a substantial discount and split a portion of their revenue (50/50) with Groupon. Oh, the pain… the pain!

 

What did the restaurant do wrong?

If you’re a GetResponse customer, their mistake is as easy to spot as the claws on a lobster: they never asked for our email address.So they have no way to follow up. No way to lure us back. No way to build a relationship. Except to offer another (probably unprofitable) Groupon deal. How can a brick-and-mortar business grab email addresses?

Low-tech solutions still work, especially in a retail business.

  1. Set up a business-card fishbowl near the cash register with a sign advertising a weekly drawing for a  prize: maybe a discount, special dessert, or free drink.
  2. Here’s one your staff will love — a server contest. Waiters and waitresses win a prize by collecting email addresses from their customers.

Hi-tech methods work too.

  1. This one looks fancy, but it’s as easy as nibbling on a fantail shrimp. Put a card with a QR code on each table. Smartphone users will know what to do. The code can direct them to a web page with a special incentive… and a sign-up form, of course.
  2. Want to really impress them with your tech savvy? Download Forms on the Go to your iPad or Android tablet. Patrons can enter their email address on the spot.
  3. And here’s another solution that will appeal to cellphone users — the Join By Text integration. A table card invites them to text a code to receive weekly deals and special offers.

How does this lead to more sales?

Now you’ve got their email address. Even if you lost money on the Groupon deal, you’ve got the opportunity to earn their business for a lifetime.

  1. Create a special newsletter campaign. Special offers work great. But for more profitable sales, try themes: Bring-the-Kids Night featuring fun foods; Dinner-and-a-Movie Night in partnership with a local cinema; or Lovers-Only Night featuring candlelight, champagne, and sinfully delicious desserts.
  2. Set up an autoresponder series to invite new subscribers to return again and again. Tempt them with coupons they can download.
  3. Use the segmentation tool to find out who downloaded your coupon, and then send them a similar offer soon. Equally important, find out who didn’t click. Send them something different, or change the subject line and send the same offer again. This time, maybe they’ll bite.
  4. Encourage patrons to brag about you on social media. Include a mouth-watering pic of your signature specialty, with social media icons nearby.
  5. Create a landing page where patrons can find out your current special offers, special events, and news. Be sure to include a sign-up form and invite them to subscribe.

 

Does this really work?

These tried-and-true techniques work in any consumer-based business, especially retail. And they can be a lot more profitable than a succession of Groupons (or similar coupon-distribution services).

You may need to experiment to find a winning formula. But after you nail it, you can use it as a control for testing and tweaking new ideas. Soon you’ll have a thriving email marketing program and a loyal customer base.

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Should you continue using Groupon?

Think of Groupon as a lead-generation strategy. If you get new people in the door with a break-even or small loss, you’re halfway there. Then use email marketing to build a relationship. Soon you’ll have the option to wean your business off Groupon.

So dream up a Groupon for your restaurant or other retail business. And be sure to grab their email addresses. Your results will be… positively yummy.

Let’s hear it for Groupon! Do you have a Groupon horror story? Or did your ad hit a home run? C’mon, share a taste of your experience.

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