Should you use a group buying site like Groupon for your small business? They seem to be everywhere now, with new ones popping up all the time. Before jumping on the group buying bandwagon, consider the following:
1) Make sure that you can break even
Some of the biggest horror stories are about small businesses getting way more response than anticipated, and then dealing with a deluge of customers that are paying a price that does not even cover costs. Do the math and make a sound financial decision.
2) Target carefully
With the wide variety of options available now, do some research into the target markets of group buying sites. Make sure they are a match for you.
3) Think through the logistics
Can you accommodate a huge influx of customers? Some sites will allow you to limit the quantity. If you go ahead with sites that don’t allow it, have a plan in place to deal with a surge.
4) Consider your offering carefully
Are repeat customers a huge part of your business? If so, group buying sites can be great for customer acquisition. If your customers tend to be one time, a group buy is not the best option for you.
5) Think about upsell potential
For some businesses, the goal of the group buy is to get people in the door. If your business has upsell potential, group buys are great opportunity for additional sales.
Now let’s hear from you. Have you done a group buy? How did it go?
Martina Iring is an online marketing consultant in North Vancouver, BC. She is on a mission to help the little guys make sense of internet marketing through her blog, Small Business Bliss. Be sure to grab your free small business website improvement guide.