SMCADL Monthly Chat #1.2: Group-Buying Sites
The second part of our monthly chat in July was dedicated to Group Buying Sites. We discussed things business owners/managers should bear in mind when offering deals through group buying sites and identified important aspects of group buying sites that will lead to long-term viability, both for the site and its clients.
5 Questions To Answer Before You Offer Deals:
- Will you be able to deliver the exact product and/or service that you describe in your deal? Be sure that you will be able to deliver the product and/or service you have quoted in a timely fashion. It is also advisable that you do not treat those who opt for your deal no differently that you would your average customer. If the consumer feels frustrated or misled by your offer, this may do more harm than good for your brand, product and/or service. They may express their complaints to your staff, or worse, share their negative experience with others.
- Will you be able to offer a deal where you are able to showcase the best of your products and/or services without threatening your financial viability? Be sure to consider how many deals you can afford to give away. For example, if your business is a beauty salon, would you survive (financially) if you are booked out for six months as a result of the number of consumers who opt for your deal? You potentially could be operating at or below cost; ensure that you consider the impact this will have on your financial viability.
- Does your brand want to attract consumers who are always looking for the best deal, not necessarily the best product and/or service? Group-buying sites are continuing to fuel the need or desire for some consumers to find the best deal. Those who are looking for bargains are unlikely to become loyal to you and your business. The only loyalty these bargain hunters will likely develop is to group-buying sites generally, not to the brands who offer the deals through these sites. This is because these consumers are motivated by the best (read: cheapest) deals.
- Consider your target markets: who are you trying to attract to sample your brand? Look at all the different group-buying sites: Groupon, Scoopon, Living Social, Cudo and figure out which of these best suits your brand, product and/or service. You should also consider niche group-buying sites, like The Qwoff Boys’ Vinomofo for (wannabe) wine connoisseurs or if your budget will allow, your own group buying site, like Dell Swarm.
- Are you prepared to meet the demand you may create in the short term? There have been instances where businesses have been caught off guard, and been unable to cope with the demand that has been created as a result of customers cashing in on their deals. Be prepared: hire/roster extra staff and have plenty of products in stock. Having said all that, group-buying sites provide a great opportunity for businesses that need to move unwanted, old or discontinued stock while potentially reaching new customers.
3 Aspects Of A Good Group-Buying Site
- Clear and simple site layout – it’s easy to find your products, share the deals, etc
- Minimum and maximum buy-ins – allows business to manage the demand consumers may create
- Set fees per item sold – a fixed cost independent of the RRP of the product or service being sold
It’s a bonus if the communities of consumers who use these group-buying are active and engaged who share deals and review products and/or services.
Thanks again to those who made it to SMCADL Monthly Chat in July. :) We look forward to seeing you all again on Friday 19 August at Brunelli at 8am. Please RSVP here: http://on.fb.me/mTb7p3