10 Profitable Groupon Marketing Tips

I’ve been a fan of Groupon since one of our Pittsburgh restaurant clients launched the city’s first promotional campaign. And, I’ve become a bigger fan since other hospitality clients have achieved success and after discovering that Groupon founder Andrew Mason is a Pittsburgh (Mt. Lebanon) native – you go guy!

If you read the marketing trades you’ll find some complaints about the lack of profitability of using Groupon as a marketing tactic, but I’d bet that those complainers were not prepared to take advantage of the popular loss leader strategy.

Here are ten profitable Groupon marketing tips.

1. Say “NO” if you’re below. Below average that is. In short, you do not want to feature your brand in a Groupon campaign if you don’t “bring it.” That is, if you sell lousy food (even marginally or mediocre OK), have poor service etc., you do not want to do Groupon! If you do not “deliver the goods”, Grouponers may simply put you out of business earlier than you would normally through negative reviews online etc.!

2. Get buy-in to prevent crying. Far in advance of your scheduled launch, talk through the campaign pros/cons of Groupon with your staff. Get their buy-in early on and clearly explain why everyone needs to be engaged in this huge loss leader effort and why you’ll need all hands and minds on deck to flawlessly execute the campaign. Tell them, “what’s in it for them!”

3. Map your cap. Cap the total number of deals you provide to Grouponers. This creates urgency and protects margins since the offer deadlines are long. Plus, you need to make sure you can handle the traffic.  Sure you want to make short term money – you always do – but your eyes need to be on the prize of repeat business!

4. Don’t wreck your average check. Make sure your deal/offer does not match you average check/purchase to allow for upsell and add-on sales opportunities. And, a lower price tag protects you as well on total customer acquisition costs. Keep in mind that you’re earning around 1/4th of what you’d usually make in an average sale which means you’re losing 3/4ths on virtually every sale.

5. Don’t laugh – add staff. Trust me – make sure you add staff to handle increases in store traffic, phone calls and web hits during and after the sale. You’ll need it!

6. Right your Website. It’s highly likely that your Web site has never seen the kind of traffic it will see on your Groupon day. Make certain your brand’s value proposition is clear, meaningful and relevant throughout your Website and especially on your home page because it’s going to get pounded. And, fix your typos, broken links etc., – net, clean it up! Also, monitor your Groupon comments on your “game day” and answer questions there as well on your social media channels.

7. Up-sell, cross sell and do well. Train your customer facing personnel to up-sell and cross-sell and guide all Grouponers to more profitable add-ons. However, make sure you have lots of exciting ones to offer too.

8. Train to explain. Carefully review (and test their knowledge) your Groupon procedures and rules of the game with all team members so they in turn can explain the campaign to customers, friends and family. You need to do this crucial step to ensure viral communications and no surprised/unhappy customer experiences. Make certain everyone is happy to take Groupon customers and consider putting someone in charge to answer escalated questions and make on the spot decisions to satisfy customer concerns.

9. Retain and gain. Since Groupon does not give up its email database and/or the contact information of customers who take advantage of your offer, it’s critical you have a system (recording system and/or additional incentive for customers/staff) in place to capture valuable new customer contact information (e.g., email addresses, mailing addresses, cell phone numbers, birthdays etc.,). You’ll also want to track your success with regard to add-ons, average check/transaction, redemption rates,  repeat business and more to determine your success and key learnings should you do it again – consider a customer survey too!

10. Show how to WOW now. A ton of your Grouponers will be new customers (and might be bringing other new customers in with them) and may be unfamiliar with your unique value proposition, but you have a great – maybe once in a lifetime – opportunity to WOW them, make them repeat customers and spread your good word. Make sure you take advantage of this opportunity. Be a servant leader and SERVE lights out!

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$6 Google AdWords Campaign Lands Dream Job

For anyone looking for a new job (pay attention college grads) or trying to get that next big sale and running into a roadblock because you can’t get the attention of a key decision maker, check out this brilliant job search strategy by copywriter Alec Brownstein.

  1. Brownstein used Google AdWords to target Ad Agency Creative Directors on Madison Avenue in New York
  2. He bet 15 cents per click that these Creatives were no different than the rest of  us self absorbed people who Google ourselves
  3. What the CD’s saw when they Googled themselves was a personal ad from Brownstein – BRILLIANT!
  4. Young & Rubicam offered him a job!

Note: Brownstein’s Google Job Experiment YouTube video has been viewed over 500,000 times!  Rock on Alec!

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Lt. Col. Allen West – A Marketer’s Dream

I don’t have many favorite politicians – check that – I don’t have a one! And, I’d bet most of you don’t have one.

Until maybe now.

Republican candidate for Congress and former U.S. Army lieutenant colonel Allen West is someone I’ve been following throughout his race in the Sunshine State!

And you should too.

Allen West, is a former U.S. Army lieutenant colonel and is running this November as a Republican candidate for the United States Congress in Florida’s District 22.

Watch this video of West in action. No notes – pure passion and conviction – clear message coming from experience – a complete mastery of the power of video and the mastery of the public speech!

When the Republicans and McCain and Co., got outgunned and derailed by the Obama campaign in the last presidential election, there’s no question that one of big contributing factors was that they were far behind in mastering the New World Order of interactive and social media marketing tools.

In the next election/s, you’ll see that everyone will be on the SMM bus. And, it will be somewhat of a level playing field in terms of marketing execution since most everyone will be wearing a pretty nice SMM tool belt and carrying a well equipped toolbox.

Check out West’s Web site and you’ll see its complete with all the appropriate SMM tools however, his talent, integrity, character and clear brand message and performance rules.

Certainly money helps, but in this online, always on world we live in, citizen journalists can help West even out the playing field for his underfunded brand.

Watch out for the Allen West’s of the world (performance based brands with character, integrity and trustworthiness) and remember that tools are cool, but tools don’t rule because anybody can buy them and learn how to use them.

To excel these days, recognize that for today’s informed consumer, what truly matters is a clearly communicated and meaningful brand promise delivered from a trustworthy, proven brand. Guaranteed.

P.S.: I call Lt. Col. Allen West a Marketer’s dream because it’s so easy to promote a brand you believe in. I’ll bet West wins in November – this American Patriot prays and hopes that he does – we need more good people like him in government.

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Sampling, Freemiums and Marketing Lagniappe

We work a lot in the restaurant and hospitality and retail industry. And, I’m amazed at how many businesses lack a sampling or “Free” taste test component in their marketing operations plans.

In 2008, Arbitron  studied product sampling (Arbitron product_sampling_study_2008) and over one-third (35%) of those who tried a sample bought the product during the same shopping trip. And, nearly 60% said they would buy a product after trying it.

Sampling, which reaches 70 million consumers every quarter, “is both effective in making new customers aware of products, while also establishing a firmer identity with those consumers who have considered the product before,” said Carol Edwards, svp of sales at Arbitron’s out-of-home media department, in a statement.

The survey segmented consumers into three areas: acquisitions (those new to the product), conversions (those willing to buy it after sampling it) and retentions (those who had previously purchased the product).

Check out these sampling results:

  • 85% of retentions who sampled a product said they would purchase it again compared to 60% of conversions.
  • Almost half (47%) said they would now look to purchase it.
  • 28% of respondents received a free sample in the past three months. Of that group, 64% said they accepted the sample.
  • Nearly a quarter of those polled (24%) said they bought the product they sampled instead of the item they initially set out to purchase.

Freemiums are another terrific way to generate customer interest and involvement by offering a product or service for free (e.g., software, educational webinar etc.) while charging a premium for advanced or special feature.

For example, I offer free marketing advice through my Blog, however for more specialized marketing consulting advice I charge a fee. And, it helps drive leads.

Marketing Lagniappe occurs when a brand offers a customer something for free and unexpected when they buy something – surprise and delight occurs. Stan Phelps’ new book due this Spring (can’t wait to read it – nice helpful Web site too) will highlight 1,001 “something extras” such as Doubletree Hotels’ practice of giving warm, delicious chocolate chip cookies.

Stan’s five R.U.L.E.S. for effective lagniappe are that these free offers need to be Relevant, Unexpected, Limited, Expression, Sticky.

I couldn’t agree more and plan to take a harder look at my client’s marketing plans and bake a little sampling, freemiums and/or lagniappe that surprises and delights into them. You should too.

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Sound Marketing Advice

There’s a great article in Fast Company about the, “The 10 Most Addictive Sounds in the World,” by Martin Lindstrom.

Lindstrom’s neuroscience based hypothesis contends that over 80% of today’s marketing messages are based on sight and a brand is not maximizing its communications when it forgoes appealing to a person’s other senses. And, sound is underutilized!

Take a quick quiz here.

I’ve certainly witnessed the appeal of sound in automotive, amusement park and restaurant marketing (e.g., background music, worker noise levels etc.,) and found it fascinating that when the sound was removed from slot machines in Las Vegas, revenue fell by 24%!

Be more aware of the power of sound because when your customers can hear your sizzling steaks, you’ll hear your cash register ring more loudly!

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The Kids Are Alright Part II

In an earlier post, I reported that it was great to see the Gen Y kids driving the tremendous outpouring of financial support for Haiti relief via texting.

I’m happy to report that the American Red Cross “Text ‘Haiti’ to 90999” campaign has raised $24 million to date. See the DMNews story here.

Think about this campaign for a moment. It has achieved some amazing accomplishments – in a short period of time – since this devastating earthquake hit Haiti just last week on January 12th:

  • $24 million has been raised via $10 individual donations to help the Haitian people – 1/5th of the amount the American Red Cross has raised to date – breaking all records by a huge  margin.  Reference note: After Hurricane Katrina – a mere 4.5 years ago – the ARC only received $120,000 via texting – and Katrina occurred on American soil!
  • The ARC has built a valuable mobile text database for future marketing communications and financial appeal efforts
  • The ARC’s core donor base skews older and texting gave the Gen Y folks an easy, quick and convenient channel to offer their support (marketing lesson – treat different people differently)
  • The campaign execution of  the ARC and its mobile firm partner mGive was flawless – amazing too – considering the fact that they started to work on the texting campaign the evening of the earthquake
  • The viral goodwill spread of the “Text ‘HAITI’ to 90999” campaign in Social Media channels such as YouTube, Facebook and Twitter (100K tweets/retweets)

I’m far from being in the Gen Y segment, but I did text a donation to the ARC and will tell you that it was easy for me to participate. As important, I felt comfortable donating because of the supportive and reinforcing messages I saw on TV news and various high profile broadcasts such as the NFL playoffs and the Golden Globes.

Also, after texting the shortcode “HAITI” to 90999, I was asked me to respond “yes” to confirm my donation and then I received a nice comforting thank you too – nice touch.

This overwhelmingly positive experience led me to spread the ARC’s good word and to feel more comfortable using this channel in the future.

Strong brand promise, ease, convenience, simple message and trust are the hallmarks of success for the ARC’s texting campaign and they could be put to good use for your brand’s future success too.

Photo by CollectiveGood.

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The Kids Are Alright

If you think young people these days are inconsiderate, selfish, concerned with only themselves and wear their “pants on the ground“…think again.

Soon after the devastating Haiti earthquake hit, @RedCross tweeted: “You can text “HAITI” to 90999 to donate $10 to Red Cross relief efforts in #haiti.”

Kudos to the Red Cross marketing folks for being prepared (excellent online disaster newsroom) and recognizing the fundraising opportunity available to them in this terrible time of crisis.

And, much more kudos to the kids that drove this “texting bus” because they’re the ones credited with leading this Red Cross effort which has raised over $10 million for the cause since this record breaking mobile fundraiser was launched last Tuesday.

This is a great example of using technology to build rather than destroy.

Watch text marketing grow from this effort and put in on your list of things to test for your business too!

P.S.: Here is a list of 8 ways you can help Haiti by texting:

  1. Text HAITI to 90999 to donate $10 to the American Red Cross
  2. Text HAITI to 25383 to donate $5 to International Rescue Committee
  3. Text HAITI to 45678 to donate $5 to the Salvation Army in Canada
  4. Text HAITI to 20222 to donate $10 through the Clinton Foundation
  5. Text HAITI to 864833 to donate $5 to The United Way
  6. Text CERF to 90999 to donate $5 to The United Nations Foundation
  7. Text DISASTER to 90999 to donate $10 to Compassion International
  8. Text RELIEF to 30644 (to connect with Catholic Relief Services who will instruct you how to donate money with your credit card)

…the 9th way to help is to pray.

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Average Today Loser Tomorrow

loserDuring recessionary times, the first place people cut back is with their eating and drinking out dollars.

Sure, there is a progression. First, white table cloth restaurants are the first to feel the pinch, then casual, fast casual and then fast food.

After a scorching sales tear for some time, McDonald’s is now considering a $1.00 breakfast menu nationwide.

With unemployment at 10.2%, no one is safe.

Now it appears that people are buying less at the supermarket.

More are using shopping lists, feel prices are to high, hate the experience and nearly 8 out of 10 would flip brands on a deal! Loyalty be damned.

The restaurant and hospitality industry isn’t the only one suffering – every industry is suffering and only the smart, speedy and strong will survive. So, what can you do to succeed in these tough times?

Here are five marketing ideas to put on your shopping list that will help you survive and thrive in these tough times.

1. Do remarkable things that add value and drive word-of-mouth. Pretty simple statement, easy to understand, but so few do it. So, you do it. Positive word-of-mouth drives customer referrals, online reviews and media coverage while keeping your marketing costs low. Do something remarkably well.

Value offerings for specific reasons make sense (e.g., Anniversaries), but you need to watch it because deals are so easily copied and it’s difficult to move to higher prices when times get better.

You need to work on creating unique value priced offerings. People are re-thinking all of their purchases, so if you’re not truly giving value or a exceptional experience you better start. This requires packaging creativity and more customer focus.

List all the possible value-added services and amenities you offer and then look for ways to improve your customer’s experience for little or no cost to you.

If you’re in hospitality you could offer things such as free parking, free upgrades, late check-outs, drink certificates etc., and look to your marketing partenrs to help defray the costs.

Deliver value in creative unique packaged experiences.

If you’re average player in a today’s recessionary economy, you’re running backwards and you’re a loser.

2. Keep the Heat On. If you’re out of sight, you’re out of mind. Don’t just arbitrarily cut your advertising, but look for ways to more effectively spend or not spend it.  Get into social media marketing, improve  the search results of your web site, network.  Create stronger, more emotional appeals for your goods and services.

3. Strengthen Your Customer Relationships. Strengthen your sales force and put together win-back and retention strategies. Work to maximize the lifetime value of your key customers and integrate all of your communication messages into relevant targeted appeals.

4. Build a Centralized Segmented Marketing Database. The bedrock of all customer relationship management strategies is a unified, centralized and segmented marketing database. Fortunately, it’s easier than ever to set up and manage a CRM system today.

5. Become a Direct Marketing Master. Direct marketing needs to take a greater role in your business plan whether it be direct sales, email, mail, phone etc., The most effective weapon is email marketing to current customers (but smartly segment them).

This is a good list to follow, but make sure you do not skip the first step!

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SoulWow

Bravo and May God Bless Them!

It’s amazing how real visuals and a simple clear message presented in a personal and fun way can drive results.

I sure hope this isn’t a one time gig for the Catholic Church.

Just goes to show you that if business as usual isn’t building your business you need to take a different approach.

I’d love to know how it did for business. It’s certainly driving word of mouth buzz

P.S.: But wait there’s more from this new book about the history of infomercials.

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