Groupon Chief Says Despite Huge Discount ROI Is Always There
Rob Solomon the COO of Groupon stunned the audience with his figures. It’s the fastest growing company in history, and in just nine months they’ve grown from 100 to 3000 employees. Now they offer their amazing deals by email in 30 countries.
I know anecdotally that it really works…at least people do gobble up the coupons. A local restaurant in Northampton MA sold $17,000 worth of gift certificates in 24 hours. We just ran a special and sold $1400 worth for the GoNOMAD Café . My friend Joe, a radio guy, believes that discounting isn’t a good way to bring in business, and that since we get only $2.50 for each $10 certificate it’s a bad deal. “Discount hunters aren’t good loyal customers” he said. And on stage a questioner of Solomon said the same thing, hey, I never go back to those places that I used the Groupon at. Solomon said it’s up to the merchant to do a good job, and 95% of the time merchants get enough back to pay for the discount. “There’s no other medium where they can acquire a new customer for $5,” Solomon said.
But if you look at the fact that 30,000 people got sent the email with our deal and that bringing people in for the first time is how we build the business, so far I’m happy.
Soloman told the gathered group at Phocuswright that if we’re all not embracing “SNO,” or Social Network Optimizing, you’re missing the huge growth that’s possible. He suggests a much more aggressive embrace, not token efforts but bringing in young people who really get it.
Solomon showed another chart of the top 100 twitter accounts and none of them was a travel business entity. Atop the list was Oprah, followed by CNN Breaking News.He emphasizes local. Everything local. From embracing Google maps and Yelp and other local sites unless you’re in the vacation rental business, you’re gonna be toast.