i'd like to step back a few years and look at where Groupon came from. back in the haze of what is now a billion dollar enterprise, there was a little company called ThePoint. now, this little site was created with activism in mind. the idea was to bring a pile of folks together, and if there were enough of them, then they'd stage some kind of action. right now there's a push to make Starbucks offer free WiFi. once 100,000 sign on then they will all commit to not buying drinks at the shops.
now this is nice and all. its basically a big disconnected version of signing a petition. from this idea of getting a bunch of folks to commit to something we get the idea of Groupon. a certain number of folks agree to buy something, the deal 'tips' [it's suddenly worth it for TheGap to offer a 50% off coupon] and everyone's credit cards get charged.
so, excellent. 11million folks get a Gap coupon. they go buy stuff.
now lets look at China.
the interesting thing about the US is that we have fixed prices. retailers write a price on a little tag and we all abide by it. this is why coupons work. another little tag is given to us that overrides that price tag. but in most other companies there's more of a 'suggested' price going on. walk through a market in Bangkok. if you see something you like and get a price on it not only is it customary to argue that price, if you just go with it the seller will be offended!
China is the same way. the big retailers have only recently arrived in force with their big box stores and mandated prices. and this doesn't quite sit right with the average Chinese. so what do they do? well, they arrive in force and demand a group price!
"Of particular interest is the tuangou (‘team purchase’) phenomenon, which involves strangers organizing themselves around a specific product or service. Think electronics, home furnishings, cars and so on. These likeminded then meet up in real-world shops and showrooms on a coordinated date and time, literally mobbing the seller, negotiating a group discount on the spot."
interestingly, a site like Groupon, as it moves toward setting up a bit more social media aspects and creates two sided rating scales for buyers and sellers, is all set to make this happen in the US. if a crowd of moms walked into a Target and demanding that they sell 5 packs of diapers for the price of 3 they probably wouldnt get very far. but if Groupon brought back ThePoint and put the control of pricing on the shoppers side . . . well, that would be something.
as online coupon sites have started to move from small and local to big box and national manufacturers they're going to have to come up with a next step. they have the clout. it's just a matter of getting folks to believe that their dollars are all the power they need.
incidentally, there is a site doing this to some extent in the UK, and i know of at least a few moms who've chosen to circumvent retailers all together setting up group buys direct from manufacturers based somewhat on how Co-ops work.
flash mob + credit card?
Tuesday, October 5, 2010
Monday, October 4, 2010
the double edged sword of enlightened self interest
Walmart. The retailer everyone loves to hate. And yet in the past years they've made strides in environmentalism that the government has never managed. They've reduced the packaging for detergents, they pushed the whole US to switch away from the old incandescent bulbs and on to the energy efficient ones, their carbon footprint has been minimized as they increase the efficiencies of their shipments [and force the manufacturers they carry to do so as well].
So they've done some good things. In every case there's a huge win for Walmart behind this. Concentrated detergents take up less shelf space, so Walmart can optimize the number of products they have on shelf. Selling only energy efficient bulbs means fewer types of products to stock [I wouldn't be surprised if fewer of these are damaged in shipping either], and the famed Sustainability Index? Well, if they make everyone else behave, they look better and can tack that on behind whatever individual efforts they're making, right?
So now the newest tidbit is what some stores are doing in response to recession spurred hand-to-mouth shopping. First of all, we have 24hr Walmarts. Why isn't the whole world 24hrs? I'm not sure. There certainly are enough night owls out there and enough times when it's been 11pm and I haven't gotten my grocery shopping done [never mind the 3rd shift workers right?].
But here's the new part. With folks getting their food stamps and government checks on the first of every month, Walmart realized they were getting a spike in sales, with huge rings. Folks were coming in and literally doing their entire month's worth of grocery shopping in one night.
What was Walmart to do? Well, they've changed what they have for folks to buy. That first week of the month their pack sizes get bigger, so folks buy up bigtime. Not too surprising. But it's what they do at the END of the month that's impressive. They start stocking more small size packages.
Walmart has always suffered from losing the 'quick trip' or 'fill in' shopping. Folks go to buy big or they go . . . well, elsewhere. To keep their shoppers from maybe going to a grocery store for that one last roll of toilet paper or couple of food items to stretch til the next paycheck, they've got smaller size items on shelf that last week.
Seriously. Japan has been doing this for ages, only with their tiny convenience stores. Go into a shop in the morning, you find breakfast items everywhere. Go back in in the afternoon . . . totally changed over to lunch stuff. What? Yes, that's right. They stock according to the time of day.
Here in the US and in most stores you get seasonal items. No, you can't buy lawn chairs and sun tan lotion in the winter... but no shop has taken it quite this far before.
Walmart has hit another sweet spot of seeming to help their shoppers while really just maximizing their sales. Folks go in to stock up, Walmart makes that easy. If they stock up, they don't buy elsewhere. Those same shoppers now can be directed to fill in at Walmart too, making it their ONLY shopping destination.
They've come a long way since the days when they refused to sell "the morning after pill" . . . but they're still freakin scary to me. Especially when they wind up being the biggest supplier of prescriptions and decide to charge $9 rather than $4 for generic birth control . . . Jerks.
So they've done some good things. In every case there's a huge win for Walmart behind this. Concentrated detergents take up less shelf space, so Walmart can optimize the number of products they have on shelf. Selling only energy efficient bulbs means fewer types of products to stock [I wouldn't be surprised if fewer of these are damaged in shipping either], and the famed Sustainability Index? Well, if they make everyone else behave, they look better and can tack that on behind whatever individual efforts they're making, right?
So now the newest tidbit is what some stores are doing in response to recession spurred hand-to-mouth shopping. First of all, we have 24hr Walmarts. Why isn't the whole world 24hrs? I'm not sure. There certainly are enough night owls out there and enough times when it's been 11pm and I haven't gotten my grocery shopping done [never mind the 3rd shift workers right?].
But here's the new part. With folks getting their food stamps and government checks on the first of every month, Walmart realized they were getting a spike in sales, with huge rings. Folks were coming in and literally doing their entire month's worth of grocery shopping in one night.
What was Walmart to do? Well, they've changed what they have for folks to buy. That first week of the month their pack sizes get bigger, so folks buy up bigtime. Not too surprising. But it's what they do at the END of the month that's impressive. They start stocking more small size packages.
Walmart has always suffered from losing the 'quick trip' or 'fill in' shopping. Folks go to buy big or they go . . . well, elsewhere. To keep their shoppers from maybe going to a grocery store for that one last roll of toilet paper or couple of food items to stretch til the next paycheck, they've got smaller size items on shelf that last week.
Seriously. Japan has been doing this for ages, only with their tiny convenience stores. Go into a shop in the morning, you find breakfast items everywhere. Go back in in the afternoon . . . totally changed over to lunch stuff. What? Yes, that's right. They stock according to the time of day.
Here in the US and in most stores you get seasonal items. No, you can't buy lawn chairs and sun tan lotion in the winter... but no shop has taken it quite this far before.
Walmart has hit another sweet spot of seeming to help their shoppers while really just maximizing their sales. Folks go in to stock up, Walmart makes that easy. If they stock up, they don't buy elsewhere. Those same shoppers now can be directed to fill in at Walmart too, making it their ONLY shopping destination.
They've come a long way since the days when they refused to sell "the morning after pill" . . . but they're still freakin scary to me. Especially when they wind up being the biggest supplier of prescriptions and decide to charge $9 rather than $4 for generic birth control . . . Jerks.
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