Going Local: Groupon

Last week, we briefly name-dropped two social media sites that are changing local marketing. We mentioned both Groupon and Signpost in the same breath, but both services are deserving of a much more in-depth look.

Groupon is, in actuality, far more complex than simply a discount or coupon site. Groupon focuses on what they call “group buying,” but this is more like splitting a bill than it is buying a time share. The offer starts with a business contacting Groupon. An offer is constructed, setting a certain number of shares, and a price per share. Then, that offer is presented to Groupon members for a limited time, and if all the shares sell, the offer is emailed to all of the purchasers as a gift certificate. If the shares do not sell, purchasing members are not charged, and the deal is canceled. Assuming all goes well, the profits are shared between Groupon and the selling company, customers get a good deal, and everyone goes home happy.

For example, a restaurant may want to sell 100 shares of a $20 dinner for two. If 100 Groupon members buy those shares, they each get a $20 gift certificate good for the meal, and the restaurant splits the $2000 with Groupon.

For all parties involved, the key is making sure that all of the available shares sell. If the minimum is not met, no one makes money, and no one gets a discount. Groupon accomplishes this by encouraging social sharing through other channels, such as Facebook, Twitter, Blogger, and even mobile platforms. As a result, Groupon uses social media as a tool, essentially saving a step for some small businesses that would like to offer a deal without tackling multiple channels themselves. The smartest part of Groupon’s strategy? All of the footwork is done by Groupon members. If a member wants to save money on a dozen roses, they need to spread the offer around to as many buyers as possible. It’s the members that spread the offers through social channels, not Groupon.

If Groupon is the profitable social media outsourcer, Signpost is the mom-and-pop equivalent, but that doesn’t make it any less effective….


Founded in 1989, WebbMason is one of the fastest-growing print and brand management service companies in the United States, helping marketing departments and their internal and external partners save money and streamline processes through a winning combination of industry expertise, exceptional print supply chain partners and technological innovation. Headquartered in Hunt Valley, Maryland, WebbMason has 20 sales offices throughout the United States.


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