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To Groupon or Not to Groupon: Is Social Shopping Right for Your Business? #SageACT

by on ‎11-14-2011 08:24 AM (3,879 Views)

Social media can be a very powerful medium to help promote your business, and in this article, we're going to tackle the crazy world of “social shopping” services such as Groupon, LivingSocial, and Scoutmob. These services can be a great way to bring new customers to your business. But before you go offering up one of these deals, you need to understand how they work and make sure you can handle the increase in business.


These three services are very similar. All of them allow you to sign up to receive email alerts, or you can go directly to their web sites to see the latest offer. Usually the offer is good for 24 hours, with a different offer each day. And all three have free mobile apps for SmartPhones and the iPad. That’s where the similarities end.


With Groupon and LivingSocial, the customer purchases your coupon upfront and the service pays your portion to you (typically half of the total price of the offer). A good example is a coupon for half off the price of a product or service, good for 6 months up to one year.


Scoutmob has a different approach. Customers request the coupon and receive it for free. As a merchant, you pay Scoutmob a small fee for each customer who redeems a coupon at your business. Scoutmob is available in many cities already, and they have plans to add a new city each month.


In most cases, you won’t be making money on the coupon; it’s really just another form of marketing. Your goal is to make the shopping experience so great that customers want to return, and they'll want to tell their friends about it.

You will need to have a plan that ensures you can keep up with demand and keep customers (and your employees) happy. All of these services offer tools to help you with this and you should take advantage of them. Remember, in a lot of cases, people are just in it for the discount. They won’t be back. If you have a high-end establishment, you should consider the impact of offering deep discounts. Is this the message you want to convey to your existing or future clientele? Is there a better way to target them?


The group coupon and social shopping can be a great way to reach a lot of potential customers. There are new services popping up every week. If you think this is right for your business, find the service that fits the best and get on it! Don’t be shy. And don’t let your competitor beat you to it.


We’d love to hear your experience – either as a customer or as a business making an offer through a social shopping service. What's your feedback?


This article brought to you by Sage ACT! and Sage Peachtree