While Groupon may be struggling as a company overall losing 43% of it’s share price in 2014 the daily deals website still represents a great opportunity for small businesses to market their offers. That is… so long as you know what you are doing!
Groupon is undeniably a great way to promote to large numbers of people. Regrettably one British e-tailor found how just how popular the daily deals site is with almost disastrous consequences.
Alistair Cochrane runs Unique Gift Hampers a fine foods and gifts retailer based in Scotland. Alistair thought that he could use Groupon to kickstart sales. By offering a huge discount of 70 percent he thought that a Groupon campaign could bring in some extra income to the business.
Typically a retro sweets hamper would retail for around £25 but Unique Gift Hampers put together a special deal where they would sell a sweets hamper similar to these ones for a reduced price of £7.50.
Alistair was shocked when over 1500 buyers grabbed the opportunity to take the highly discounted price. It was way more hampers than the business was able to produce and they were forced to employ extra people to handle the huge surge in business. This actually meant that they ended up losing £1 on every order. Ouch!
An Expensive Mistake
Unique Gift Hampers, who have been operating for 4 years said on their blog that they would honor the Groupon offer despite it being an expensive mistake.
“We have been up all night putting together these Sweet Hampers. We will get them shipped but there might be a small delay.” they groaned. “We won’t be doing such a great offer on Groupon again!!”.
“We usually really enjoy putting together interesting hampers and baskets that make great gifts. But this time it turned into a bit of a slog and we are feeling the pain in our pockets as well as suffering from lack of sleep. Despite this Groupon deal being a bad move every single gift box that we send out of our store will be prepared to the same high standards that we have set at Unique Gift Hampers.”
“It really was a ill planned marketing promotion.” the blog continued. “Everyone is always singing the praised of Groupon but if you are not careful then you can get your fingers burned.”
No Limits To Orders
Groupon have publicly stated that there are no limits to the number of vouchers that can be sold their their deals site.
“We approach each business with a tailored, individual approach based on the prior history of similar deals,” they said.
However it’s clear that in this case something went wrong.
Daily deals sites such as Groupon offer massive leverage to small businesses, but with the leverage comes risk and you’d better know what you are doing or you could end up with a costly bill.
The business world is not always easy to break into. Most companies begin with an idea, an investment, and then a fanatical amount of marketing. Some companies find a magical product that nearly markets itself. Other companies find success through unique marketing techniques. Saddleback Leather Company seems to have found its magic in the combination of the two.
Dave’s Original Bag. Still going strong!
Saddleback Leather Company has created very expensive and popular leather briefcases thought by some to be the best leather briefcase money can buy. They are both fashionable and durable, with one hundred year warranties. The cases are meant to survive in a wide variety of environments and to last a lifetime. In fact, the company is more concerned with the product than with quantity sold. The founder seems to be very personable and has a way of connecting with potential buyers. In spite of his wildly successful product, he still works closely with the company and releases blogs about the products. He even creates amusing YouTube videos that inadvertently address the quality of the product. One particular video explains how to create a knockoff Saddleback bag by explaining the importance of quality leather. Not many company founders are that personally involved with the marketing. There is no professional marketing that can replace a down-to-earth founder with a sense of humor.
The Saddleback’s founder travelled the world. He dreamt of a leather case that would last through his travels while taking on a life of its own. His initial case was a custom creation for himself in Mexico. The case was fashionable, durable, and had personality, which received many compliments. This kicked off the company. The story is both entertaining and endearing. It also does a great job of demonstrating the outlook of the company. Many companies claim to care for quality, but the Saddleback Leather story clearly shows what the cases were designed for. The story itself works to market the cases in a way that no professional marketing company can. It doesn’t hurt that there are pictures of these cases everywhere from India to underwater.
Saddleback Leather is in demand because of its quality. The original product was created to be durable and last a lifetime. The cases take on lives of their own as they travel with you to work or to the other side of the world. The marketing that Saddleback Leather does works because it is very personal and down to earth. The founder seems very approachable and modest in spite of his success. He created a wildly successful company with fanatical followers, but chooses to talk about family and travelling when telling his story. Saddleback Leather seems to have found the magic combination of quality product and personal marketing, and has become a great success because of it. There are many great bags out there. There are many companies with amazing marketing. However, Saddleback Leather seems to have found just the right combination of product and promotion.