That big “SALE” sign in your window is just BS!
Looks like FTD and Groupon have had a huge Valentines day faux pas. According to Techcrunch.com, “Groupon offered users throughout the U.S. a $20 off coupon for Valentines Day flowers from FTD. People who bought the coupon had to use a special URL to purchase the flowers. And then they were shown a regular price for the flowers of $50 before the $20 coupon. Which is fine except that the regular FTD site shows a price of $40 for the same item, meaning Groupon users only really got $10 off, not $20.” What caught my attention with the Techcrunch.com article was the authors idea that, “I assume that ‘sale!’ signs in retail businesses are usually just BS. The stores keep normal prices higher than they should be so they can offer customers a faux discount. Whether it’s always true or just often true doesn’t matter. People don’t really get all that excited about signs that say ‘HUGE SALE 50% OFF’ or whatever. We’re desensitized to it.” While I agree that most people don’t get excited about half-off anymore, the idea that retail stores keep their prices high so we can offer customers discounts is absurd. Yet I have heard this before from people who don’t know what it means to run a small retail store. We have an image problem.
The Techcrunch.com article finishes with this, “for Groupon to continue to grow they need to get more big national advertisers, and those advertisers need to not be screwing around with customer trust. The Gap campaign was well handled. This FTD ‘deal’ wasn’t. Sour deals like this hurt Groupon’s brand, because burned customers won’t be so eager to check out the new daily deals. They’ll just assume it’s a scam, and ignore it all. Just like those HUGE SALE! signs in the window at your favorite retail store.”
The author of the article say’s Groupon needs big national advertisers that won’t screw around with customer trust. Say what? If the author of this article is a customer of yours, he thinks your overpricing your merchandise just so you can offer a HUGE SALE. He also thinks big companies care more about customer trust? Why get involved in Groupon if the people you are going to attract with it are like the author of this article? Where is the long term relationship building?
I have written about Groupon before. Why would a garden center would want to get involved with a business model that devalues the plants, and other gardening goods we sell? My market is not the guy who authored the Techcrunch.com article who thinks we are overpriced unless we mark stuff down by half. Why would I want to focus my attention on someone who believes only large companies care about customer trust. A guy who believes that, “just assume it’s a scam, and ignore it all. Just like those HUGE SALE! signs in the window at your favorite retail store.”
Crazy low prices on selected merchandise, that has to have a laundry list of qualifications and restrictions to prevent customer mis-understanding, is not for me. My predication is Groupon is going to wish they sold out to Google when they had a chance.