Groupon discounts can overwhelm vendors
Synopsis: Brick-and-mortar retails shops like Philz Coffee market themselves on Groupon to get more customers in the door. Groupon ends up delivering more leads than shops/Philz Coffee can handle. People get grumpy and complain.
3 thoughts:
1. Waiting for individually-pulled coffee can get pretty irritating. I barely have the patience to wait for one person in front of me. If there are 10 people in front of me from 10x'ed traffic, I'm walking out.
2. Too much of what you've wanted can be a bad thing. Especially in small-business settings, entrepreneurs tend to confuse expansion with optimization. Sure, getting more people to use your service is important, but you also need the infrastructure and the operational savvy on the backend to withstand increased volume and achieve balanced growth.
3. There seems to be a shift in the online/offline business dichotomy. The trend for modeling a successful online business used to be taking the best practices in the offline business and replicating them on the web (internet retail is a good example). Now, the lessons learned in the online world are creeping offline, as evidenced by Groupon taking the initiatives to educate people in the article. Maybe this will go even one step further -- maybe offline businesses will start replicating what works well online.
Putting on my former online advertising geek hat -- we've solved the "too much" problem like this quite a while ago by identifying some key metrics and learning to track them to make educated decisions. Only If "Cost-Per-Action" and "Unique Users" principles, two of the more well-known online marketing metrics, could be applied to Philz Coffee's partnership with Groupon...
One question comes to mind -- is it even possible to track these offline?
