"Deal-of-the-Day": Prepare for the Unexpected to Turn your Group Buying Promotion a Success

"Deal-of-the-Day" promotions, such as those offered by Groupon, LivingSocial and others, are gaining momentum among small and mid-sized businesses. It's not unrealistic for them to see hundreds or even thousands of individuals taking advantage of their deal. And this immediate blast of new customers, products and services purchased is what appeal to businesses. In just a few minutes or hours, they can boost profits and get the word out on their business and its offerings. 

Besides, the process looks relatively simple. All is done for you, because the deal-of-the-day providers usually handle most of the things involved in the process: distributing the deals to subscribers, managing and processing the purchases, and providing the appropriate coupons for customers to redeem.

Seems easy enough, right? But is it in reality? It is not rare to see how companies fail terribly on group buying promotions. A recent study from Rice University reveals that 32% of all campaigns on Groupon are unprofitable for businesses.

Are you well prepared? Can your business handle the major influx of new customers, phone calls, e-mails, appointments and reservations? Yes? Think again! The success of your deal-of-the-day campaign will be determined by how adequately you will manage to handle this increased volume in service. After all, you don't want to disappoint your clients, which is a real possibility if they're unable to quickly book their services.

With this in mind, you should give your promotion a full consideration in order to decide if you will need any additional preparation before launching a deal-of-the-day campaign.

Retail and similar businesses that sell material goods and products may only need minor tweaks in their sales process, especially if customers can redeem their coupons online for the products. However, in cases when the individual must pick up the item in person, the things become quite complicated. That's right, when appointments and reservations come into play, the scenario gets much trickier. 

Here are some things to consider when preparing your business for a deal-of-the-day campaign:
Target your campaign correctly. You know that promotions will surely achieve greater returns if they are customized for particular audience. Many factors could be taken into consideration - such as season, geography, trends, news, demographics, etc. For instance, if you are providing value to a geographic region understand the geographical focus of the group buying site you are using.

• To lure the people to grab your offering, you can add some extra incentives such as free shipping, or any other stuff you come up with, which will contribute to the success of your promotional campaign. At the same time, you should make your financial analysis accurate, so that you don't get bankrupt.

• Another important thing to know when planning your campaign is that you will have to try to take a full advantage of it, because you can't expect to produce repeat customers with your group buying promotion. This type of promotions are attracting so-called "deal chasers", and 59% of them will not spending beyond your promotions. In addition, 75% of the Groupon clients will never buy full price at your company in the future.

Your office resources might become insufficient. You need to assess them and come up with alternative plans and solutions. For example, a sudden influx of traffic could cause your server going down. It is a matter, you should be prepared before the launch, because once happened, your "deal-of-the-day" promotion would turn out a big failure for you.

Train your stuff for the new "deal chaser" crowd, and have in mind that the sudden increase in bookings can put an immense pressure on them. 

Double-check your existing personal and make any necessary changes to ensure you have the best staff to accommodate all of these new bookings and appointments. Among other considerations, you need to think about things like time slots, shift hours, support staff devoted to handling the phones and answering e-mails, as well as inventory of products needed for the services. If you can't manage all this with the current resources you might need to appoint additional staff.

• You may have sufficient inventory for your usual number of weekly appointments, but not for the additional ones booked through your group buying promotion. Products go hand-in-hand with many services, such as spas and salons, and you'll want to make sure you have enough of these items readily available for your new appointments and reservations. 

Group buying promotion are a wise way to increase sales and earn recognition for your business. But they can also cause a lot of frustration for owners and staff unprepared for the sudden volume of sales. A quick analysis of your current capabilities and simple modifications can easily turn your Groupon campaign in a success.

About the author

Internet Marketing On the Go blog will help you stay on the cutting edge of online marketing, and might easily be the missing link that will make your online biz rock in 2010.


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