Groupon Turns Traditional

Do you subscribe to Groupon? If not, you should. I’ve been a subscriber of Groupon for a few months now and I love taking advantage of the deals they provide in the Phoenix area. If you aren’t familiar with Groupon, it is an e-commerce phenomenon that features a daily deal on the best stuff to do, see, eat and buy in cities across the nation.

The history of Groupon is quite interesting – Groupon grew out of a website called The Point. The Point launched in November 2007 and allowed users to start a campaign asking people to give money or do something as a group. Basically, it helped people come together and solve problems that couldn’t be done alone. Founder Andrew Mason, came up with the idea of Groupon as an antidote to a common ailment—to spread the word to others about new and cool things that our cities have to offer.

Now that you have the background on Groupon, let’s move on to its brand development. I just read a great article about Groupon in Advertising Age. The e-commerce entrepreneur has been among the best case studies for the power of word-of-mouth marketing, having grown in 2010 from having a presence in one country to having a presence in 35, with nearly 400 million subscribers. However, a little over two years into its existence, Groupon thinks “spreading the word” is no longer enough. The company will be extending its brand into traditional advertising, beginning with pre-game spots in the Feb. 6 broadcast of Super Bowl XLV.

Groupon’s President and chief operating officer Rob Solomon thinks it is time to experiment with traditional offline media to maintain momentum and extend the Groupon brand. William Baker, professor and chair of the marketing department at the University of Akron, ties in Groupon’s brand development with credibility. He believes the act of Groupon going on TV around the Super Bowl will add credibility to the Groupon brand and boost top-of-mind recall.

Other observers of Groupon’s shift from online to offline media are not as happy about this transition. Sucharita Mulpuru, an e-commerce analyst at Forrester Research, believes Groupon’s transition to offline marketing will get them a lot of PR; however, she also thinks that PR doesn’t always translate into sales.

Although I am a developing PR pro, I have to say that I do not agree with Ms. Mulpuru. Groupon making its way onto TV, particularly around a huge televised event, will definitely create buzz that will, in turn, broaden its reach. I think this will definitely help drive sales for Groupon.

What do you think? Do you think that Groupon’s move to traditional advertising will gain credibility and most importantly, will offline exposure drive more sales?

5 Comments   |   5 Comments