All posts in “Groupon”

Group Buying …..Still a Good Idea for Businesses?

Wangari Kamande is a Research Analyst at Social Media Group.

If you’re an avid group buyer, you are all too familiar with the lure of buying trips to those random vacation spots in the middle of winter as the deals role in on an early, gloomy Monday morning, or buying that dinner deal at 4pm in the afternoon when you could eat a sack of potatoes or better yet, that massage deal on Friday after a long work week and you just want to get pampered because you DESERVE IT!  These are the moments where I stare at my credit card as if it were a person and say to it, “Are you going to hurt me for buying this?” the answer is usually “most likely”…so I take a deep breath and let it slide…

So how is group buying working out lately?

State of the Industry in Canada

There are a number of group buying sites. I personally subscribe to Groupon and TeamBuy; other popular sites are: Dealfind, WagJag and LivingSocial. Here are some interesting facts from GroupBuying Canada:

  • Canadians spent approximately $400 million through daily deals sites in 2011
  • Group buying in Canada has a current market size of $415 million
  • There are about 140 daily deal / group buying sites in Canada and over 40 aggregators (more than the US on per capita basis)
  • In any given city or province, there are different leading sites e.g ,Tuango completely dominates in Montreal and the province of Quebec
  • Over 50% of all group buying sites have been launched from Toronto
  • The majority of deals and sales are also from Toronto
  • Niche sites are not as popular in Canada in comparison to the US where niche sites for golf, pets, kids, food are popular

Source: Canadian Coupon Saver

Given that the industry is ripe with opportunity, is it all fair game for small businesses?


  • The model appears to work best for attracting new customers as many discount seekers purchase what they would normally not try because they are getting a good deal.
  • Creates an awareness and provides exposure for businesses, especially small and medium sized ones.
  • While customer loyalty is not promised, if customers get a good experience they are likely to provide repeat business and thanks to the Internet and social media, word of mouth recommendation is limitless.


  • Customers are spoiled for choice, there is a new deal every day and customers are likely to go with the best deal of the day, so customer retention might be somewhat of a pipe dream.
  • Some small businesses are not always prepared to deal with the influx of customers as a result of the deal; this could harm your brand’s image in the eyes of customers and negate any positive results you hoped to gain.

According to, the list of questions below are useful for businesses who are considering using group buying sites as a marketing or selling strategy:

  1. What are your goals and objectives that make group buying sites a good strategy for your company?
  2. Can your business afford it?
  3. Can your company meet the expense of offering products or services at a discounted rate?
  4. Do  you have a high profit margin?
  5. Can you up-sell or cross-sell other products and services for potential profit?

Outside of Canada, the industry in general appears to be facing some challenges. Recently there have been articles surrounding consumer fatigue on daily deals, according to a New York Times article, when Groupon reported its second-quarter results this week, it said that active customers grew just 3 percent, a significant slowdown from previous quarter-to-quarter customer growth rates. While traffic to Groupon was higher at the beginning of 2012 than last year, it was down almost 10 percent in May and June from the same months in 2011, according to comScore.

Further, groupbuyingcanada, has been reporting a number of acquisitions in this space with Teambuy purchasing Fabfind and Wagjag and Tuango just announced the acquisition of the assets of DealoftheDay from the Yellow Pages. While other Daily Deal providers seem to be shrinking or selling and investment firms and groups want nothing to do with the Daily Deal business, it seems that for Tuango and Wagjag that is all great news. They, unlike others, are growing and on a buying spree.

What do you think about the future of group buying sites?

Social Media Roundup for July 30, 2010

Are you ready for your 15 minutes?

This week YouTube announced that it has changed it’s video upload limit from 10 minutes to 15 minutes. This is good news for users who enjoy posting their lengthy video feedback responses to the newest episode of Jersey Shore.

YouTube says that since it now has a tight handle on dealing with copyrighted content, users who upload large chunks of TV shows and movies are less of a concern and therefore longer videos can be permitted.

Groupon introduces personalization

We’ve all heard of the Daily Me phenomenon, but what about the Daily Deal phenomenon? I remember that exciting time of week when all the retail sales flyers would arrive in the mailbox and the whole family would scour over the week’s door crashers. Now, daily deals are arriving in inboxes instead of mailboxes, courtesy of websites like Groupon and RedFlagDeals.

This week Groupon introduced it’s Personalization feature which will send users one deal a day based on their preferences, purchase history and overall profile putting an end to scrolling through dozens of tire and mattress sales and cutting straight through to the good stuff.

Celebrities are also jumping on the band wagon to promote these daily deals websites. Lindsay Lohan is reportedly being paid by shopping club website Beyond The Rack to tweet about designer sales.

Speaking of celebs and Twitter…

The man who once said ““Everything that Twitter offers, I need less of” has now joined the ranks of Twitter. Kanye West, not one to do things quietly, ended his boycott against Twitter this week and celebrated his new account with a live appearance at the Twitter head office in San Francisco. Kanye makes up part of the 0.4% of celebrity Twitter users and has already attracted 306,105 followers – that’s 1,000 times as many as the average Joe.

Check out Kanye’s Twitter performance below.