Fri Sep, 2011 by Derek Mehraban
Groupon has launched a new product called Groupon Goods, which is for products online and do not need to be purchased in brick and mortar businesses. On Wednesday some Groupon users received an email for LED TVs and coffee brewers as part of the new service. Groupon says this will significantly increase their growth as they can now reach out to users that are more likely to make purchases that can be done online instead of a service that they might not otherwise need in a place they never visit.
Groupon has also introduced a loyalty program and this will help because some brick and mortar deals do not appeal to users and now they will have a fallback option to earn the loyalty rewards. Groupon Rewards allows users to unlock a special Groupon at participating vendors when a certain amount of money has been spent. The value of a loyalty program to drive sales, especially at the point of sale, is well known. This new program will probably have a significant boost to Groupon’s revenue as well as participating vendors that have brand loyalty and an interesting premise for the unlockable discount.
The digital agency can easily jump on this as a new venue to advertise its client’s products. This move is also part of a growing escalation between the daily deals vendors. Amazon recently entered the market by investing in LivingSocial and with AmazonLocal. This move can be seen as Groupon’s returning volley. An escalating fight between them can help the digital agency by reducing the fee for advertising with these publishers.