Many companies have jumped on the Groupon bandwagon in recent years. This website, which offer group discounts at participating businesses, has become an effective way to save money during difficult financial times. However, there have been numerous cases reported by various agencies including Technology Review that while these special deals may work out well for businesses in the short-term, over the long-term they may be more damaging than other methods of advertising and promotion.
Coupons and Customer Loyalty
There is evidence that suggests that new customers may try a product because they have been offered a special deal, but then never try it again. This causes customer retention rates to waver with companies who have participated in these deals. Instead of a flash-in-the-pan deal, why not have regular offers for reduced prices, special deals or promotions to encourage regular customers to try new products or services? This may be a better long-term strategy for businesses who are interested in building a solid returning customer base.
An alternate idea is to create marketing campaigns using printable coupons for a variety of products, in order to appeal to a wider audience and gain new customers. This strategy will disperse customer spending throughout your inventory, rather that highlighting one product or service at the expense of others.
Developing a good relationship with existing clients, running promotions that are specifically geared towards these customers may be more beneficial to retail outlets and specialty shops. In some instances, offering an existing customer discounts towards a new service or a discount for bringing in a new customer can be more beneficial than attracting new customers with online specials.
Social Media and Promotions
Social media sites such as Facebook, Pinterest and Twitter provide business owners an opportunity to tap into consumer markets to boost brand awareness. Oftentimes, the users of these sites will share information about products or services they find worthy with their friends and followers; this is great word-of-mouth advertising and for most businesses, it is also cost effective and can save some of the problems that can be caused by individual special deals, such as customers only coming in for one deal and leaving without perusing the rest that the given business has to offer.

Cost Versus Risk

Many popular sites that offer deals charge businesses a portion of sales to run promotions. One of the challenges with these promotions is that oftentimes, the limited nature of them will drive customers in the door and cause difficulties for regular customers. Combine that with the potential of not planning for an onslaught of new business, and the potential of doing more harm than good grows exponentially.

If you are a small business owner, sites such as Groupon may seem appealing. After all, saving money has become a way of life for many consumers, and this change in perspective has undoubtedly had an impact on businesses such as yours. However, by being aware of the possible downside to these promotions and planning accordingly, you can be sure of building a loyal customer base that will keep coming back for more. Best of luck!




8 Comments on Beyond Groupon: Reducing Your Risk When Doing Coupon Promotion

  1. Dany Moore@Photo Frames says:

    Coupons are the best affiliate marketing products, coupons offers more slashed prices and very useful to the customers.
    Dany Moore@Photo Frames´s last blog post ..8 Ways to Increase Your Business Productivity with Photo Frames

  2. Coupon Code says:

    Well having coupons or coupon codes is essential for buyers who are in a tight budget. This way they can easily buy stuff and for most, get addicted to it.

  3. Yes you are right, the coupons are one of the best assign offers to make a best deal from the business persons.
    JamesWin@Promotional Items´s last blog post ..4 Ways Promotional Items Can Make You Rich

  4. herry park

    Good efforts. All the best for future posts. I have bookmarked you. Well done. I read and like this post. Thanks.

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  5. Very useful post shared with us…Coupons are makes a great deal to customers from business persons. Coupons are act like a bridge between the audience and showman.
    Ryan Patrick@Promotional Gifts´s last blog post ..Beautiful Promotional Gift Items to Your Business Expansion

  6. soham says:

    Nice article, coupon promotion attracts more consumers, it should be shared in a wide range.

  7. James@Nandos vouchers says:

    Interesting post. Just taking a quote from it:

    “There is evidence that suggests that new customers may try a product because they have been offered a special deal, but then never try it again.”

    This is very true, and also expected, but having said that there is probably an equal number who like it and go back that would have never tried this food before.

  8. Millard@printable coupons says:

    I am sure this article has touched all the internet viewers,
    its really really good post on building up new blog.
    Millard@printable coupons´s last blog post ..printable coupons

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