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Groupon Founder Talks About Success and Growth

Marketing podcast with Andrew Mason (Click to play or right click and “Save As” to download – Subscribe now via iTunes

This week’s guest on the Duct Tape Marketing Podcast is Groupon founder Andrew Mason. Groupon is a very unique service that allows individuals to collectively buy discounted, local products and services as long an enough people do it.

The way it works is that people sign up in their community to receive daily updates offering them the ability to buy a deeply discounted local product or service. The hyper-local deal of the day offering points the spotlight on businesses like a city guide with the trick of getting people to go out and experience their community.

Groupon has experienced tremendous success for several reasons. One local business only, enough people have to buy or get their friends to sign-up, and they have to pay for the coupon. So the business may get several hundred new paying customers to try their business. We all know that if you get someone in the door, there’s a great chance they turn into long term buyers. The fact that people pay money to try your business makes them a better prospect because them use the Groupon and then buy a nice bottle of wine.

In just 15 months over 3 million people have signed on, 180 employees now work at Groupon and millions of dollars are being saved and generated in the current list of 30 cities now served (project 80 by end of 2010.) Groupon takes a small piece of each Groupon sold and sends the business owner a check for the entire purchase.

Mason attributes tremendous word or mouth driven by the act of saving, viral social content, such as dining out, and the natural incentive to share so the deals tip.

Businesses are researched to insure faithful participation. Business owners can sign-up or simply learn more at Groupon Works.

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  • http://jaxseoworks.com/ Ken

    Hi John!
    Groupon is a win-win concept, and you stated the rationale well.
    I wrote an article about the concept several months ago http://jaxseoworks.com/e-coupons-for-your-busin…, and I am glad to see that their business is continuing to grow.
    Thank you for sharing.

  • rileybiz

    This is an appealing idea. However, it may put Groupon in the position of competing against Sam's and Costco. Its probably not an issue now because the service is just getting started, but if they keep growing competition will come from some quarter.

  • http://www.ducttapemarketing.com/blog ducttape

    I don't disagree about competition but it won't be from Sam's or Costco – they are promoting hyper local services like spas and bars, not consumer brands – a very successful Groupon is 500-1000, that wouldn't even get Sam's out of bed. The more likely test will come from copycats, but Groupon has a head start and a bunch of money now.

  • jaredullrich

    Groupon is an amazing website. I am very impressed at how functional and cool it is! This is a company that is here to stay!!

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  • http://www.ducttapemarketing.com/blog ducttape

    I agree – very cool company

  • timtasker

    GroupOn is of the most innovative ideas I´ve seen for getting discounts. The good thing about them is how they have managed to create a kind of social community that share their interests to get the product they need. It also means a powerful channel for business´s to promote their products as well as selling them.

  • http://fastforwardacademy.com/index-page-irs-enrolled-agent-exam-course.htm Monique

    I had never heard of Groupon before this article. I feel like I've been missing out! Thanks for this– I will definitely be checking this out.

  • http://www.facebook.com/people/David-Hall/1548636984 David Hall

    Seems like a no brainer for a company looking to increase business.

  • http://www.motormillions.com/ dean graziosi

    Its interesting to know success and growth of Groupon.I came to know certain new things from this post.I believe that its quite hard job to stick with a success.You have to improve some things for growth.

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