Groupon...One of my competitors

Royal Man

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XTREME1

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So far the guy sold 308 so that is about $7700 for groupon and he has to clean 924 rooms at about $8.33 a room. Would he have been better off doing $2,000 in ads for 3 rooms at $25 for a limited time?
 

smastio

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Dave Yoakum said:
smastio said:
Bundy said:
Technology review did a study on groupon and you should expect 15% to be repeats and expect 76% to do coupon only


I am always looking for data like this... would you please provide the link to the data. Once I get it I cane see if it is just carpet cleaners or all industries...

Thanks...

Summary of study:
http://www.media.rice.edu/media/NewsBot ... W&ID=14811

PDF of study:
http://www.ruf.rice.edu/~dholakia/Group ... 202010.pdf

Thanks Dave - I had already made a video of that study, but did not have the Full PDF. Good to have. thanks. Here's the link.... http://www.screencast.com/t/7BKs8heNBxXs
 

Brian R

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Ace said:
303 sold. You should buy some up Brian. I doubt your normal subs will work that cheep. Groupon is great for the bait and switchers now thay don't have to pay for postage and have a direct line to suckers looking for that deal that sounds to good to be true.

Lol, that's almost what I am doing....except for the bait and switch part. I am getting all the work through Groupon and getting all the work done with myself and others.
If I buy the groupon and send the company to do one of my 4 room jobs that would normally be $120.00 minimum...I could stand to make $70.00 per instead of my normal $60.00......now if they will split the upsells with me....You may have something there. lol



Bundy said:
So far the guy sold 308 so that is about $7700 for groupon and he has to clean 924 rooms at about $8.33 a room. Would he have been better off doing $2,000 in ads for 3 rooms at $25 for a limited time?

You're paying for jobs that may or may not be there.

Groupon.....They send you jobs BEFORE you "pay".
 

Brian R

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The numbers can be twisted either way.

I'm not saying that's what you're doing...but if I say....

I an sit here and send my subs out to do the job and make $10.00 per job before they walk in the door.......Groupon is paying me to do the job.

I can also say...when I do the job with all my expenses, I probably make the same amount before I walk in the door. But I make a bit more than that.

You can turn it either way.

If it's not coming directly out of my bank account and going to someone else...I'm not paying it.

I do understand that money from my bank account paid for the phones, Service Monster etc....I'm just keeping it simple
 

XTREME1

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so what is you deal going to be? I will break it down for you. His phones, internet, taxes etc are all free
 

Brian R

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FCC said:
Brian,

How much would you say you paid to get the repeat customers from your last groupon deal?

Have you really made any money before walking in the door? Isn't your "profit" already spent trying to retain the groupon customers and convince them to pay your normal prices in the future?

going by the numbers based on you subbing the job since that would almost be a necessity if it is a big seller


I have to look at the Groupon deal as just one big job, repeats and everything.

The big jobs make up for the minimum jobs etc.

But I paid $6.25 on most accounts to get the repeats according to Service Monster.
 

Brian R

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By the way...they can pay the same price as last time....it's just 100% of it comes to us instead of less.
 

Brian R

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Bundy said:
so what is you deal going to be? I will break it down for you. His phones, internet, taxes etc are all free


Which deal...the lease deal with my sub?
I'll give %s but that's about it. It tends to get into the area of giving other's info out.

He will be paying me about 25% of what the entire company made last year.

It's broken down into endless recurring monthly payments that can go up a few % every year.

If he doesn't want to do it anymore, the company comes back to me.
 

Brian R

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FCC said:
so in essence groupon has led you to lower your prices?


No, my minimum here was supposed to be $90.00 but that didn't work out.
Jay D told me before I ever got to Dallas that the minimum for the area was about $65.00

He was right.
 

LisaWagnerCRS

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Brian R said:
FCC said:
so in essence groupon has led you to lower your prices?


No, my minimum here was supposed to be $90.00 but that didn't work out.
Jay D told me before I ever got to Dallas that the minimum for the area was about $65.00

He was right.


Who's minimum? The city's? A region does not "set" your minimum, you do.

Is that what you're saying?

Lisa
 

XTREME1

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I found an ad for his company that said 3 areas for $79

My minimum is $75


Lisa I posted my take on Groupon, I would love for you to read it and give your take
 

Brian R

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FCC said:
Ok...so what is the difference in this "whole house special" and the one on your site? Why would you have that price on your site if the market won't sustain it? Are you trying to scare away customers? or just hoping the few that accept that price makes up for the many............




coupon_whole_house.JPG


That's not "my" site...it's a Mini Franchise and they set their own prices.
 

Brian R

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LisaWagnerCRS said:
Brian R said:
FCC said:
so in essence groupon has led you to lower your prices?


No, my minimum here was supposed to be $90.00 but that didn't work out.
Jay D told me before I ever got to Dallas that the minimum for the area was about $65.00

He was right.


Who's minimum? The city's? A region does not "set" your minimum, you do.

Is that what you're saying?

Lisa

I'm just saying that's what most people I've encountered feel they should pay. You're right, I do set my minimum...but I'm not throwing away jobs either.
 

Brian R

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Bundy said:
I found an ad for his company that said 3 areas for $79
My minimum is $75


Lisa I posted my take on Groupon, I would love for you to read it and give your take


What are you trying to say?
We'll do the work for advertised prices.
 
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I remember Bill Bane warning of the "Walmart effect" on PRODUCTS over twenty years ago, as manufacturers progressively cut corners and lowered costs to meet tighter price points. His warning has come to fruition as high quality producers in the USA have been displaced by lower quality imports.

He (perhaps wrongly) thought SERVICE businesses were almost immune to this corrosive effect because services "could not be mass-produced and stored in a warehouse".

Sadly the MMM, Groupon, and similar "price merchandisers" have started to gut the service businesses...with their greedy fearful acquiescense.
 

XTREME1

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I am just saying you have an ad for $79 for 3 areas nothing else. I could say plenty like your groupon ad is the same as your others so there is an FTD deception going on. Or I could just get 2 3 areas for $158 instead of your other deal for $199.

That wasn't my point it was that I saw your ad
 

Brian R

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Bundy said:
I am just saying you have an ad for $79 for 3 areas nothing else. I could say plenty like your groupon ad is the same as your others so there is an FTD deception going on. Or I could just get 2 3 areas for $158 instead of your other deal for $199.

That wasn't my point it was that I saw your ad


I may have an ad out for $79.00 but I'm not running a Groupon for that.

How is that fraud?

And you can't use 2 offers (Groupons) at the same time
 

LisaWagnerCRS

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Bundy said:
I found an ad for his company that said 3 areas for $79

My minimum is $75


Lisa I posted my take on Groupon, I would love for you to read it and give your take

My take is this...

http://www.scribd.com/doc/35158272/CF-H ... er-clients

To sell something you need 3 things:
1) a product/service
2) a sales message
3) a message delivery system

People spend all their time on their "stuff" and the delivery (Groupon, ads, youtube, postcards, whatever) - and very little time on the "message" and WHO they are targeting as an "right fit" customer.

Low price offers on Groupon do work. You will get calls. Sometimes lots of them. And you will dig a big hole in costs to do that in time, labor, supplies and frustration. Especially frustration - because you will have people who chose you ONLY on price, so they will suspect a hard upsell coming, and they will be guarded. It will take you more to try to sell them. The difference between boxing Justin Bieber or Mike Tyson. Price offers bring you the tougher task (you could probably verbally knock out Bieber.)

People ask "how much" because price is all they know to ask. This is classic Piranha curriculum.

Education-based marketing shares with them what they didn't know about a product/service, and why it's important to them.

It filters out the ones who only care about price, and brings you the ones who care about other things.

And when you are in that house, and begin that client relationship based on YOU being the "expert" they trust - the sales process is smooth, no one feels pressured, and you create a high lifetime value of a client in repeat and referral business.

I think that biggest detriment to our industry is that too many who do the work devalue what they do. They don't think customers will pay good money for good work and service. They look at their business through their own eyes and say "I would not pay more than $75 for 3 rooms"... but you are NOT your customer. That's what the article lays out - the complete difference between companies based on low prices versus a higher priced service business experience.

Everyone could eat at McDonald's - but not everyone wants to. And they will pay for a better experience, and people love to give money to people they enjoy working with. It's the difference between a one-time cheap transaction like what we are talking about in this thread - and a lifetime client relationship, which is cultivated through marketing messages that focus on things other than "low price."

That's my take.

Lisa
 

LisaWagnerCRS

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Brian R said:
Cantina Laredo sent me a text for free guacamole

I went there and spent $70.00

Nuff said.

Seriously? Brian, please go get a little bit of marketing education. You don't even need to pay for it, the programs at http://www.ilovemarketing.com are free.

You are an existing client of CL - a relationship already in place. Give a little something to get them in, and of course they will buy more. Especially the perfect choice of guacamole - you need something to put it on. With restaurants especially on their slow days, it's a great reason to get someone in.

That's a savvy strategy, low cost, free to people you already value - and the reciprocity leads to immediate additional sales.

That is completely the opposite of Groupon - where you devalue the prices to strangers, who come in not caring if you are good or not, just that they got a screaming deal.

The marketing psychology is completely different, and so is the positioning.

Good marketing blogs to learn from besides Joe's ILM (I mention that because it has several cleaning related examples in the first episodes that are perfect for struggling cleaners) - but also Seth Godin (http://www.sethgodin.com) and John Carlton (http://www.john-carlton.com)

If you are going to be the moderator for "making more money" - you need to learn some more about marketing message to target market matches and creating win/win selling success.

Please. Teaching everyone to "pay to work their asses off" is not the "next best thing" - it's a trap for most who don't have the systems to strong sell and make it break even. Most of us don't want a company that pressures people into buying - we want them to be happy to have found us, and happy to pay us. That all gets determined on that "reason why" they buy in the first place.

Lisa
 

Brian R

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Lol@ Lisa
People with money got that way from spending their money wisely...a good discount to start establishes trust or good faith...not the defensiveness you're talking about.

(Chips come free with the guacamole by the way)

My marketing experience is from the real world. I've read and taken classes of course but it all comes back to what is reality and what is theory.
Your marketing strategies work for some and they are a little old school for todays audience but your still making money from it so good luck with that.

Sometimes changes need to be made with the times.

Your take on Groupon goes against what you think is good marketing so of course you will dismiss it before it becomes something bigger than you want....whether it's good for the industry or not right?

Your condescending post toward me is laughable and I take no insult all things considered. Your personality level and creativeness leaves something to be desired and that's 90% of marketing right there.

Maybe you should read a few books on how NOT to put someone to sleep while recording a message.

The Groupon deal is as good as you make it. You offer the customer something to prove yourself to them. If you're not sure of yourself or your company then don't do it.

Marketing doesn't stop at the biggening of the job.
 

XTREME1

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Lisa,
I will take Brians post as an endorsement of the products you sell and will dust off my Joe Polsih CD set and take a good honest look at it. If Brian is happy with groupon and the deal being atleast 75% of his and subs take, I am definitely going to steer clear. I would like to set up a conference call with Brian and my Fater inlaw because my father inlaw a(and I ) for that matter think it is impossible with a losing deal.

Brian do you want me to set this up and you can explain fully how it works and you can be incorporated into a Fulbright and Suffolk University Study on entrepreneurship.He is always looking for new set ups and relationships between business and clients.
 

smastio

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Can I moderate the call?

I spoke at a (let me re-phrase); I was asked to speak at a Carpet Cleaning Marketing Seminar last week and I spent about 15-20 explaining the DOD phenomenon, and some of the opportunities and pitfalls. I can tell you that most people in the audience (which was a varied audience) looked at me like I had 3 eyes. Brian - you are correct in that everyone needs to keep up with the times (even you Mr. President - sorry just had to say that). Not everyone is willing to change and try new things. I'm sure that it is half the battle for what Lisa does with her marketing. I know it is for me, but to each their own. I for one enjoy these tit-for tats about marketing and ask myself - if it weren't something that people were trying to clear out of the head as not good for them, then there wouldn't be the unbelievable activity it has generated.

The one Caveat that I would say is that Groupon is NOT the only player for the DOD (Deal of the Day) platform. Look at the others, they tend to be more flexible and attractive with splits.

Heck even a bid wig at StarBucks bought a huge stake in Groupon. I'd bet he or his people know that they are doing; or they are just hopped up on caffeine.
 

XTREME1

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why the hell would a congressional fulbright scholar award winning educator sitting on the congressional board of oversight for the fulbright , Nobel recognized economist let you moderate a discussion call? What are your credentials?
 

Brian R

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I feel a hotseat coming on for the green room.

Isn't there a chat room in the blog area now? Is that the greenroom? I 'haven't checked it out.


By the way Groupon just emailed me and confirmed the date for 3/3/11. They said before that they were 95% sure that was the date but now they are 100% sure.

Wish me luck.


The guy in Sacramento is up to 400 sold.

I'm getting nervous....lol
 

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