In my previous blog post, I told you my personal story of the natural human behavior to hunt for a bargain.
Bargains are a powerful customer magnet, but may cause a heart attack for the business owner, if not done correctly.
Groupon has capitalized on that psychology, BIG TIME!
After all, they were at one point (and probably still is) the fastest growing company EVER. Period. Yes – faster than Amazon, or Google or Microsoft. (Although, I don’t know how it stacks up against Apple’s recent growth spurt.)
Groupon makes it convenient for the small business owner to transition from the printed medium to an electronic format. Then they added a unique twist: leveraging the herd mentality.
People find comfort in numbers. When they see other people behaving a certain way, the immediate impression is: “Hey, don’t forget about me. I wanna get in, too.” In other words, the wannabee syndrome.
So if you haven’t even thought about Groupon for your business, you’re missing BIG TIME!
6 Coupon Mistakes To Avoid
However, if you’re ready to jump into the bandwagon either for the 1st time or the 99th time, here are 6 mistakes to avoid in the coupon craze.
1. Not offering any coupon at all
It’s basic human nature to gravitate towards a deal. It doesn’t matter whether it’s a free consultation, a free refill, or a $1 sweepstakes for a brand new house. When you make an offer, you automatically touch your prospects’ subconscious hot buttons.
The only reason NOT to do this, is when customers are lined up in front of the door, and you DO NOT want any more new business.
2. Not tracking coupon results
Tracking can be as simple as counting how many coupons were redeemed. I advise my clients at least 2 things:
- Dig down to the bottomline: return on investment. Understand the specific costs and revenues generated by the campaign.
- Experiment with at least 2 different offers at any time, and statistically determine which one brings in more feet inside your door.
3. Not using social media
Social media marketing is the electronic version of word-of-mouth marketing - the most effective method to attract new clients.
Social media is the perfect marketing channel for the herd mentality. The more people see other people patronizing a business, the more confidence they build, to try it out themselves, for the first time.
Furthermore, that confidence is turbo-boosted when they see their friends (or even acquaintances), among the crowd of patrons.
This is what makes the night and day difference between printed coupons from the postal mailbox vs. the coupons that are circulating online. Twitter followers see their Facebook friends, and Google Circles buying these coupons.
Note: Don’t forget about other platforms, like Yelp, UrbanSpoon, OpenTable or even LinkedIn.
4. Not obtaining customer contact information
In my opinion, this is the biggest mistake that biz owners make when they use Groupon.
The whole point of a coupon is to attract new people with a magnetic offer – and then hope that they will come back again, ready to pay full price.
How do you get customers back? I don’t recommend that you leave this to chance. Owners should have a proactive strategy.
Are you going to hypnotize them with your charming personality during their first visit? Well, you better!
But that’s just the beginning. You need to capture their contact information and later gently remind them occasionally, of how truly charming you are.
There are a few options for contact info: Facebook fan, Twitter follower, email, home address or mobile phone (for text messaging).
5. Not following up
This is the whole point of point #4 above; so capitalize on that valuable contact you just obtained.
Here is a common concern I hear a lot from biz owners: spamming their customers.
Technically, spam is an unsolicited offer. Obtaining contact information in Step 4 above is implied permission, but it’s always best to tell your customers what you intend to do with the information.
Psychologically, spam is in the eyes of the beholder. If you have an unattractive offer, you are perceived as spam, even though the customer explicitly grants permission.
On the other hand, an irresistible offer is always welcomed with OPEN ARMS, even among strangers that you have truly spammed.
Here’s the secret: people want to buy, but they do not want to be sold to.
There’s an art in making an offer, and there’s a science to making it effective.
6. Not taking ownership of the coupon campaign
Groupon is a great way to jumpstart your online adventures, but I wouldn’t recommend that you rely on them forever. 75% is expensive!
Ideally, a biz owner should plan on running their own in-house electronic coupons.
Realistically, I understand that most owners do not have the time to manage these campaigns. This is where automation tools and 3rd party consultants (like myself 
), can help the overwhelmed owner, to strike a balance, and control their own business destiny.
Conclusion
Just do it, before your competition does. If they get an early lead on you, it’s like starting the race with an uphill climb.
Today is always the best day to get started.
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