For the uninitiated, here’s a quick Groupon 101: subscribers to the service are e-mailed one deal per day, wherein they can choose to pay a discounted price to get a coupon for a product or service.
For example, through Groupon, a customer could buy a manicure valued at $45 — for just $30.
The catch: the deals only become valid once a certain number of people agree to participate.
So, what does all this mean for you?
In his post, John Jantsch argues that Groupon might be the most effective option “for the small business looking for ROI on marketing dollars invested.” Here’s why, from OPEN Forum:
On top of the deals the buyers receive, Groupon users are getting hooked on the hyper-local discoveries of new businesses in their community. Groupon founder and CEO Andrew Mason claims that one of the driving forces behind Groupon is this notion of exploring your own back yard….
From the business owner’s standpoint, Groupon has a very practical and tried and true advertising offering – put a discounted offer out there and only pay when you attract new business….
The local businesses I’ve interviewed tell me that the Groupon users they’ve attracted are spending far more than the value of the original Groupon purchase and turning into regular and repeat customers as well….
One of the most compelling ideas behind the business use of the Groupon tool is that consumers have to put some skin in the game in order to try your business out. This isn’t simply a free offer. When a Groupon user walks in your door, they are already a customer; they’ve spent money with your business in order to take you up on the deal.
NOW WATCH: Ideas videos
Business Insider Emails & Alerts
Site highlights each day to your inbox.