How to be a Groupon Superstar
Thursday, November 18th, 2010
Coupons used to be boring, and a lot of work. Think of all those hours spent at the kitchen table searching for the perfect coupon, then searching for the scissors, and then cutting it out. After all that effort you had to stuff it into your already overstuffed wallet only to have a clerk shoot you a dirty look when you handed it over. Luckily we now have sites like Groupon injecting a little fun into the mix. They have taken something old and tired and turned it into a social force, they’ve actually made couponing fun.
Groupon has spread across the US, Canada and Europe. Marketers both big and small are experimenting with the site, trying to learn what catches the crowds’ attention. Global retailers like Gap are featured one day, and then Bob’s Local Deli the next. It’s clear that there is value in Groupon’s proposition, although not for everyone. But how much do we know about what works on Groupon? We looked a little closer at the results for Vancouver and Toronto to see if there was a pattern worth exploring. While not a statistically significant investigation, we did see some interesting results.
There does appear to be a sweet spot when it comes to the Groupon deal. Those promotions that fell between 50-70% off and were up to $25 had the best sign up rates.
Of course not all offers are the same. The GAP offer back in August was hugely successful, it received 8,964 purchases in Toronto alone, but it is a national retailer with lots of pull. How do other categories besides fashion fare? Most offers fall into one of three categories: activity, food/drink or health/beauty. It appears that local activities are on average more popular than deals in the other main categories of food/drink and health/beauty. Groupon could be viewed as a quasi city guide, encouraging people to get out and explore where they live. Or it could be argued that activities tend to have a wider appeal than a particular restaurant or spa. Whatever the reason, marketers can on average expect between 1,115 and 2,324 purchases in their respective categories.
Groupon is still growing and its users are constantly evolving. The patterns we see today will change rapidly, but for now it appears there are some rough parameters for success. If you keep your price below $25 at the 50-70% off mark, you may come out alright.












