Any room for a groupon clone?

27 replies
Hi,

Anyone think that there is room for a groupon / living social clone site? Or would it just be futile trying to sell against the big guy's? My idea behind this is to get the customers in and then provide services to keep the customers,, instead of a one hit wonder like the big guy's.

Any Thoughts??

Roger
#clone #groupon #room
  • Profile picture of the author fitz10
    There was room for a Groupon clones just ask Tippr, EverSave, HomeRun, GiltCity, Zozi, BuyWithMe, and the other bajillion Groupon clones out there. The problem is they're all exact clones and will probably end up biting the dust the minute this coupon craze ends. If you're going to put another social couponing site out there I'd at least make sure it has some sort of twist that separates it out from Groupon and all its exact clones.

    Also lets remember that Groupon outdoes the competition mostly because it's in 300+ markets. It's next closest competitor, Living Social, hasn't hit 250 markets yet. The other clones? Most of them are in less than 20 markets so reach is a major hindrance to growth. How would you overcome that?
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    • Profile picture of the author High Horsepower
      Groupon owns this market, in fact, they dominate this category. LivingSocial is second.

      What most IMers don't realize is that both of these companies are losing 100's of millions of dollars. Both companies have raised 100's of millions to start these companies.

      The real work is Promoting, Marketing, and getting businesses to sign up. A recent independent study suggested Groupon was the "kleenex" of their industry.

      The study also stated that when business owners first tried Groupon or LivingSocial then switched to one of these wanabees, the service and the traffic was pathetic.

      Don't waste your time in this niche.
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    • Profile picture of the author javarog
      Originally Posted by fitz10 View Post

      There was room for a Groupon clones just ask Tippr, EverSave, HomeRun, GiltCity, Zozi, BuyWithMe, and the other bajillion Groupon clones out there. The problem is they're all exact clones and will probably end up biting the dust the minute this coupon craze ends. If you're going to put another social couponing site out there I'd at least make sure it has some sort of twist that separates it out from Groupon and all its exact clones.

      Also lets remember that Groupon outdoes the competition mostly because it's in 300+ markets. It's next closest competitor, Living Social, hasn't hit 250 markets yet. The other clones? Most of them are in less than 20 markets so reach is a major hindrance to growth. How would you overcome that?
      I am thinking instead of a cut of the sale I would charge them per campaign, each account would have their own shopping cart and they get to keep all the money. I know that this would not be as fruitful as percentage scheme but I am not looking to become the next coupon guru either.

      Or the flip side is just a normal coupon site portal with 30 to 50 percent discount coupons with limited times to create some sort of urgency.

      Then again maybe I am headed with the wrong direction with both... Ideas??
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      • Profile picture of the author Charles Jones
        there is plenty of room in this sector contrary to some of the previous posts. The thing that you will need to do is to concentrate on your mailing list. We have a local deal site that is in competition with my site actually (Groupon is also here and the only newspaper in town has a site too). The local site emails out to 30K people per day and they do fine (they average about 100-150 coupons per day sold and are about a yr old).

        the thing is that you will need to have a marketing budget. I have spent a fair amount on marketing and budget about 30% of ALL revenue after paying my salespeople and affiliates to advertising...sometimes more.

        Go for it....just remember that undercutting the sharing model for the monies might not be as easy as you think. In order to just do business and compete I feel you will be hard pressed to do much more than a 60/40 split. Besides....what other form of advertising (which is what this is) pays ANYTHING back to the business owner?? Not print, not tv, not radio. You need to think in those terms....giving them anything back is better than any other marketing they are doing now.
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        • Profile picture of the author javarog
          Thanks for the comments,, here I thought it was a dead horse.. Thanks,
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  • Profile picture of the author javarog
    How is that coupon site working for you or is it to early to tell??
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  • Profile picture of the author ProvenViral
    It's difficult creating a site like that because you will need unique offers from specific companies all around the USA. Although it can be difficult nothing is impossible
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  • Profile picture of the author Michael Clough
    Now there is an MLM Coupon company called Qnanza.....
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  • Profile picture of the author TrumpiaTim
    I'd shy away from this business, personally.
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  • Profile picture of the author rideotm
    Slimpon...the word just takes me in another direction, something one would find on a shelf in a store
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  • Profile picture of the author sprks79
    Originally Posted by javarog View Post

    Hi,

    Anyone think that there is room for a groupon / living social clone site? Or would it just be futile trying to sell against the big guy's? My idea behind this is to get the customers in and then provide services to keep the customers,, instead of a one hit wonder like the big guy's.

    Any Thoughts??

    Roger

    A full on Groupon/Living Social...Probably not. At least not enough to viably compete. I, however, run a local only version of Groupon. If you are thinking of a "buy now" coupon site then local is what you should focus on.
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    • Profile picture of the author attorneydavid
      I had a really good idea for a groupon clone. - Top Ten Deals - Published weekly so people don't get sick of it like groupon and unsubscribe.
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  • Profile picture of the author Ehsan_am
    There is definitely room for local deal websites.

    I'm doing something similar to Groupon however I'm targeting the businesses of a certain city or even a district (in larger cities). I'm charging a one time fee per deal and local businesses are all very interested. All traffic comes from SEO. What do I offer that Groupon doesn't?

    1 - My traffic comes from SEO. That means that people who end up on the website are actively searching for restaurants, SPAs, etc.

    2 - The business owner doesn't need to worry about its ROI. He/she pays 10€ and gets his deal published in its section.

    What are the benefits for me?

    1 - The website might not make much money but I caneasily scale it. 10 websites each making 200€ a month add up to 2000€.

    2 - I can upsell these businesses like crazy. I can offer them a landing page so they can build their list, I can offer them mobile websites, etc

    Disclaimer. I haven't actually implemented this completly. I'm SEOing the website however I have been visiting local businesses actively and 5 out of 10 are interested in getting their deals on the website for 10€ per offer.
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  • Profile picture of the author IdeaFool
    Have only used LivingSocial once. Results were great for getting people in the door for the money.

    I like the idea above of a niche-oriented coupon site. I can see that exploding depending on the niche. If, for example, the niche were, say, Making Money Online, I can foresee multiple streams of income. Not only could you make money on the spread between what price a WSO author, for example, would be willing to sell his wares and the price you sell it to the final consumer, but you could also make money off the list of buyers. Perhaps WSOs aren't the best example, as they are already deeply discounted, but you get the idea. Maybe team up with some clickbank product producers. Just some thoughts!
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  • Profile picture of the author Jack Gordon
    Aren't we over the coupon craze yet? These models bleed money, often disappointing small business owners and churning a high percentage of subscribers.

    To compete head on is like jumping into a shrinking pool.

    I'm sure there is some room to innovate. There are some interesting models listed above. Whatever you do, realize that this business is something like 10% IM and 90% offline sales. If that is what you are good at, then it may be worth consideration.

    Personally, I would keep looking at other ideas before settling on this one.
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    • Profile picture of the author medway
      Originally Posted by Jack Gordon View Post

      Aren't we over the coupon craze yet? These models bleed money, often disappointing small business owners and churning a high percentage of subscribers.

      To compete head on is like jumping into a shrinking pool.

      I'm sure there is some room to innovate. There are some interesting models listed above. Whatever you do, realize that this business is something like 10% IM and 90% offline sales. If that is what you are good at, then it may be worth consideration.

      Personally, I would keep looking at other ideas before settling on this one.
      Yes, this is a 2 year old thread the guy above you resurrected to promote a product.
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  • Profile picture of the author NewParadigm
    There is a ton of oppty to tweak the model. No need to throw baby out w/ the bath water.

    Every offliner should kiss the feet of groupon/living social. Why? They paved the way and have shown businesses will cut their prices 50% and give YOU 50% of their take to deliver them a customer. That is HUGE!

    Quit railing on the groupons of the world, tweak the model, adjust the percentages and go out and make some freakin money!
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  • Profile picture of the author Rearden
    The "Ah-ha" moment I had regarding GroupOn was when a business owner referred to those "customers" as Groupon's, NOT the business's.

    Think about it.

    I think there are two fundamental problems with Groupon:

    1) The business buys the worst type of customers -- those that are primarily motivated by price and price alone. Groupon customers swoop in for the cheap deals, and leave. I'd want to cultivate a relationship with a customer that leads to repeat purchases and higher spend, which leads me to point 2...

    2) If you look at Groupon like a lead generator, then you can make it effective. Your buying leads for the opportunity to build a relationship. And as successful salespeople know, you have to have a large swath of leads in order to succeed consistently. And that requires the salesperson to collect data like contact info, and other relevant information in order to build a pipeline to cultivate a business out of.

    Point is Retail America doesn't get it. They need consultants to realize the full, long-term value of a Groupon Lead Generation campaign. The problem is the salespeople for Groupon are just salespeople. They aren't interested in developing their client's business with their deals.

    Truth is they suck as much as their customers at getting repeat business, and that is why their business model fails.
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  • Profile picture of the author NewParadigm
    Rearden, yep, businesses are the stupid ones, yet people more often rip on daily deal sites. After using a couple dozen coupon deals, I never ONCE, not once, was contacted by any of the businesses. Not a one. Some of them had my contact info too, such as massage businesses. Others were too stupid to even ask me for my contact info. These businesses deserve the blame, not coupon sites.

    Businesses are dumb to give away the house in structuring their coupon deals. Promote a portion of the product or something that is easily upgradable. My friend who owns a med spa absolutely kills it. She might run a coupon on a few units of botox, when the average person needs many more. Only stupid businesses will run a daily deal on the who enchilada complete service. She then markets to that list on her own and runs some deals profitably because she has now cut out groupon/living social.

    After a business does a deal or two they are so dumb not to negotiate % commission to the deal sites and pit them against each other. You should be able to get them down to 20-25% instead of 50% cut. It's just insane people just sit there and grab their ankles. The deal sites are hungry for business and will wheel and deal, putting more money in your pocket, just for asking.

    Another friend runs daily deals on VIP monthly memberships to her salon which give customers discounts. It's FREE money to her as she is getting people to pay her monthly for access to specials and discounts.

    I can't believe how stupid many businesses are when they give away the house then complain about groupon!!! But that should tell you its not as hard to be successful as many think, just showing up gets you a long way. And it also tells offliners that businesses need our help making money--->opportunity.

    I'm putting together an idea for a daily deal agent program, being a negotiator for businesses to get them better daily deals, structuring them properly, and capturing a % of the savings. Show the ave daily deal biz they can cut their payout by 10%, and keep the other 10%. Not a bad commish on gross sales for putting some deals together and making daily deal sites compete for biz.
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  • Profile picture of the author misterme
    Mediaspree and NewParadigm took the words right out of my mouth, and so, +1000 to what they wrote.
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    • Profile picture of the author TheBigBee
      Short answer is no.

      But Groupon is still profitable for Warriors.

      You can aggregate all daily deal vendors through Savvr. Then call those merchants and offer FREE SMS for a month to ensure the Groupon customers come back.

      May cost you $5 per biz, but after the 60th day call em up and ask for $X per month.
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  • Profile picture of the author NewParadigm
    niches are where its at. Groupons biggest mistake was not doing everything it can do to make people choose only categories they are really interested in. Groupons problem was trying to be all things to all people, and ended up being tuned out like spam. they should have almost forced customers to choose more specific categories, instead they got greedy and spammed everyone and left it up to the customer to seek out the category page, which was still too broad and simplistic.

    I was tired of getting nail salon deals, I'm a ****in guy for goodness sake! Groupon couldn't even delineate and filter that??? I had to go out of my way to find some page to opt out of some categories such as spa, but I did like getting massage deals. Categories were too broad.

    Anyone who can target a market will do very well.

    Take the subject/market of hunting. A groupon clone would go gangbusters just focusing on hunters. deals for deer season featuring a deer stand, deals for duck season featuring a duck call, national deal for camouflage raingear, hunting lodge trips etc.... there are millions of hunters that would sign up and be very active

    That goes for any more defined market like hunting that is still hundreds of thousands or millions large. There are tens of thousands of these sizable groups/markets to nail.
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    • Profile picture of the author javarog
      Originally Posted by NewParadigm View Post

      niches are where its at. Groupons biggest mistake was not doing everything it can do to make people choose only categories they are really interested in. Groupons problem was trying to be all things to all people, and ended up being tuned out like spam. they should have almost forced customers to choose more specific categories, instead they got greedy and spammed everyone and left it up to the customer to seek out the category page, which was still too broad and simplistic.

      I was tired of getting nail salon deals, I'm a ****in guy for goodness sake! Groupon couldn't even delineate and filter that??? I had to go out of my way to find some page to opt out of some categories such as spa, but I did like getting massage deals. Categories were too broad.

      Anyone who can target a market will do very well.

      Take the subject/market of hunting. A groupon clone would go gangbusters just focusing on hunters. deals for deer season featuring a deer stand, deals for duck season featuring a duck call, national deal for camouflage raingear, hunting lodge trips etc.... there are millions of hunters that would sign up and be very active

      That goes for any more defined market like hunting that is still hundreds of thousands or millions large. There are tens of thousands of these sizable groups/markets to nail.
      Hunting and fishing would work very well with this now that I think about it and I am active in both so it might just be the ticket.. I may have to start going to shows again just to see if I can get folks to do a pre-launch sign up
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      • Profile picture of the author NewParadigm
        Originally Posted by javarog View Post

        Hunting and fishing would work very well with this now that I think about it and I am active in both so it might just be the ticket.. I may have to start going to shows again just to see if I can get folks to do a pre-launch sign up
        go for it! keep us posted!
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