29 Aug Groupon’s Spawn Making Landfall
Groupon and other similar sites took off like rockets a while ago. It’s stock opened at around $26/share in late 2011. The ability for consumers to get unbelievable unique deals on a daily basis, presented to them in a clean and easy to use manner, was an instant hit.
Eventually it faded, and now most people shudder at the thought of those daily Groupon emails. The stock now sits at $2 a share and the marketplace has pretty much had enough of it.
Enter Groupon 2.0 concepts. Instead of a national grab bag of mixed products, companies are starting to separate products based on either industry or location. This is effective for three reasons:
Industry Specific: When your offerings are industry specific, not only can you get the best deals because you are extremely focused in one area, but you can also talk the talk. Gun guys are going to talk much differently than the writers at Groupon. The pitch in these offerings matters, and specialization helps to increase the effectiveness.
Local is In: While this may seem like a no brainer to those who always valued local over multinational mega chains, the overall market is starting to value local more these days. Think of the craft beer craze. Or organic, local food. Consumers are looking for local goods and services in 2015, so tailoring your pitch to one specific area code is going to resonate with this crowd.
Increased Word of Mouth: Sports guys hang with sports guys, so if you specialize in things that sports guys like, well, wouldn’t they like to tell their friends about it? Same goes for those who value local items. Tailoring your platform to either of these options will lead to much more marketplace noise and hence much more traffic (which means more sales!).
Groupon is still a viable company, with a market cap of around $1.6 billion. But times are clearly changing, and this presents a huge opportunity for companies and individuals who know a specific segment of the marketplace extremely well.
We have worked with a few of these micro group buying sites. If you are interested in getting one set up, feel free to hit us up.