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Does Groupon Think Their Customers Are Mindless?

| Wednesday February 9th, 2011 | 9 Comments

Groupon is really getting cocky. Having recently turned down a multi-billion dollar buyout offer from Google, the company released two odd & controversial superbowl advertisements that seem to have left more people scratching their heads with a bad taste in their mouth than chuckling with the amusement the company may have expected. To sum it up, both ads began as if they were public service messages for hot button issues – one, a “save the whales” message from Cuba Gooding Jr, the other a “save Tibet” message from Timothy Hutton.

Here’s Tibet:

And here’s the Whale ad:

It’s not that I’m all bent out of shape on some kind of politically correct mission. I, and apparently many others were turned off by the suggestion that we as customers are so mindless we’d rather save a few bucks than live our lives at a slightly deeper level.

On the contrary, many of us are pushing a point as a consumer society where people are starting to think about “voting with our dollars” – rewarding companies who do the right thing, who make real investments in community, environment and culture. Just look at GroupOn competitor Act Bolder – here’s a little startup that’s offering Groupon style discounts for customers who take some kind of positive action and share it on Facebook. Or Carrot Mob, who rewards businesses directly with lots of attention if they pledge to take some kind of action on an environmental or social issue.

Neither of these are billion dollar companies by a long shot, but they and many like them are quickly filling the voids that Groupon has left open by forgetting the inspiration that can come with positive consumer action. Saving money is great, but saving money and influencing something positive in your community, or in the way a company works, is much more powerful – and will result in far greater customer loyalty in the long run.

In the meantime, Groupon has hardly appologized for the stunt, saying “We would never have run these ads if we thought they trivialized the causes.” But…. you did trivialize those causes…. big time.

Watch out, or Groupon may be the Pets.com of Web 2.0.


▼▼▼      9 Comments     ▼▼▼

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  • Earl George

    Groupon is cocky, they have gotten too big for their own good. Their advertising solution is not good for businesses and they will eventually fail!

  • Kelly

    Great post, Nick. It’s interesting that this Groupon stunt is not unlike the recent Kenneth Cole PR stunt where he tweeted, “Millions are in uproar in #Cairo. Rumor is they heard our new spring collection is not available online…” (posted here on Mashable: http://mashable.com/2011/02/03/kenneth-cole-egypt/#).

    To me, it’s unclear whether companies like KC and Groupon are just completely insensitive to these global issues, or whether they are hyper aware and are just capitalizing on ongoing conversations (my guess is that it’s the latter).

    I do know that Crispin+Porter is the agency behind the Groupon commercials. I think that Groupon should seriously reconsider that relationship.

  • http://www.triplepundit.com/author/sldi/ Terry Mock

    While I generally agree with your position Nick, I do not believe that the majority of consumers will turn their back on companies who offer them the lowest prices, no matter what their sustainability record. Unfortunately, pandering seems to work, whether it’s business or politics. Please prove me wrong if you can…

    • Nick Aster

      Sure- and it certainly depends on the company and the item in question. One hopes that there are sufficient numbers of consumers out there who do care, however, to make a difference with their purchasing power when it does count.

  • http://www.facebook.com/people/Patrick-Mahoney/1102272018 Patrick Mahoney

    Update: Groupon’s $15 BILLION IPO is now going down the toilet. Read that in Wall Street Journal. How is that for a quick “Karmic Return?” ;-)

    We will see a lot more than backpedaling from them in the next few weeks. They will next try to buy their way into good graces…but no one is going to take the bait.

    Using genocide to create buzz got them more than they expected. Now its the buzz-saw ;-o

    Its sad for Groupon, but inevitable.

    Not all money is good money. To the whales? They don’t care if you ridicule them, and their plight. But to 6 million surviving Tibetans, who have seen many millions tortured, imprisoned, and killed??? Its not worth the few bucks these greedy connivers will throw their way….maybe. Just note that the genocide in Tibet is as bad or worse than the Jews in WWII, they just haven’t talked about it. Fearing worse from China, INC..

    Crispin Porter + Bogusky & Groupon minimized that; just to leverage the $6 Billion Google Offer to $15 Billion public offering. Well, anyone with a conscience isn’t going to buy that stock. Its not only wrong, but look how clueless they are in dealing with China. I wouldn’t give my money to such slap stick, fly by night, Wall Street Opportunists. Would you?

    Crispin Porter + Bogusky & Groupon see themselves as clever provocateurs; when in fact they are sad hypocrites.

    Trying to buy a Charity Org shield to gain credibility is impossible at this point, they were blatant, shameless, and even proud of being #1 Twit-err; until the double edge of the sword revealed itself.

    If the I.P.O. is to work, they have to change their name…again ;-)

  • http://www.facebook.com/people/Leon-Kaye/726541285 Leon Kaye

    Mexico is going a civil war. Drug lords are running rampant, people are getting decapitated, mayors and policemen are fleeing cities that they cannot control. But with Groupon, I saved $8 at our local Mexican Silver Lake restaurant.

    I find the ads HILARIOUS and jarring, though Liz Hurley’s rain forest and Brazilian wax commercial was probably the best one.

    I’ve talked to a lot of local business owners who find Groupon a great way to promote their business in NYC & LA. So while Groupon may not have a social mission (why should they?), their positive effects on local benefits pay dividends that are easy to overlook.

    Relax, people. And Tibet is so overrated anyway.

  • Mariela

    We are talking about it, so the ad worked… That is the whole point…

  • http://www.actbolder.com Matt McDonald

    Nick,

    Very well written – many thought-provoking points here. Thanks for thinking of us and including Bolder in the post. We had a few thoughts upon reflection. If you have a moment, they live here on our blog: http://bit.ly/eoJ0Bw

  • Brian Schwartz

    Groupon is clearly all about their own interests with zero retention rate. Clearly their business model won’t last long. In fact, one of my ‘groupon stores’ requires 25 followers, we’re at 21. Who’s to say they’ll even agree to run your promotion to their network if it doesn’t make them the most money?

    I’d like to introduce this unique website http://www.MeetABusiness.com, which has been in the works for about a year with 2 other business partners. We do not charge businesses an arm and a leg to offer group coupons, like all the rest of the group coupon sites do. Ours doesn’t charge them anything except for the $9.95 monthly membership fee and a small extra fee if they want to purchase a deal of the day, week, or month, but the first 6 months are free, plus they get all of the other posting and searching benefits offered by the site, which the other group coupon sites don’t offer, such as business resource posting & searching, jobs posting & searching, events posting & searching, networking, and blog posting. The deal of the day feature I think could help you eliminate the ‘expiry’ issue you had with Groupon. Plus you’ll get a free long term backlink in our directory.We have over 300,000 business listings nationwide to date. Again, we are a low-cost alternative (at the moment we’re a “no cost” alternative because we’re free for 6 months) to all of the other group coupon sites that everyone complains are really bad for businesses, because they take so much of the pie from businesses.If you have any additional thoughts, comments or suggestions for the site, we are all ears. Would sincerely appreciate a plug from you on any of your network of sites.