Small Business Marketing

Groupon: To do or not to do?

By Kyle Patterson

Groupon is a new company based in Chicago spearheading a new wave in internet marketing that is growing     rapidly. A quick way for a new business to get huge exposure in a local market, Groupon's sales are expected to hit $1 billion quicker than any company in history, but for some companies, they are raising a few eyebrows at the discounts they expect small business. I recently spoke with Groupon for an offer we are making with THRiVE! coming up shortly, so yes I am doing it, but not without thinking through the risks associated with it.  First off, they ask that you discount your product at least 50%. Then they send an offer to all 60,000 of their Buffalo subscribers or whatever city you are in. They operate internationally and work in pretty much every geography. They offer your product or service for for one day only  at a drastic discount and you split the revenue with Groupon 50/50. So yes it is a great way to expose your company to their 60,000 subscribers and increase traffic and awareness of your product, but beware you are discounting your  product at least 75% off. Those are some hefty margins for any business. Know that going in  and if you can offer that as a type of loss leader and collect customer date for repeat business, it may work out for you. Either way you slice it, Groupon is  another option for your marketing mix.