This is one of those times where delay (you call it procrastination. I call it unforeseen schedule conflict) is a good thing. I heard this story on NPR several days ago about Groupon’s local web-based marketing program. And I was all ready two days ago to run here to comment.
My initial take was somewhat in line with Fast Company’s review, in which they portrayed Groupon and other such local and location-based services like Foursquare as evil predators feeding on the weak consumer, powerless to resist a good deal. Then, while I was tending to other my other chores, Ron Shevlin was writing his take. And, as he usually does, Ron helped me rethink the issue. Fast Company totally sensationalized the issue. Groupon is not running a “scheme” or “classic marketing trick”. They’re providing a service. So, what’s the real issue?
From a customer experience perspective, the real danger with such marketing programs, that seem to be producing wildly successful results so far, is that they are getting in the wrong hands. Guns don’t kill people. People kill people. For The Gap, with the infrastructure, logistics and operational capacity to handle such overwhelming demand, there really is no problem. But for small businesses like East Coast Aero Club or Red Velvet Cupcakery, sorry to say, but they’re out of their league.
The failure of these two companies was not in the execution of the marketing campaign, but in their failure to plan. I understand its a tough economy. And businesses of all sizes are looking for customers where ever the can find them. But, this story isn’t new. Its a classic case of short term revenue focus, sacrificing the long term customer experience. Let’s connect the dots:
Short term revenue focus, leads to
Overwhelming campaign response from what is most likely a larger percentage of one-time buyers, leads to
Insufficient production/delivery capacity to satisfy demand, leads to
Disappointed new customers, leads to
Increased demand for customer service and support, leads to
Alienated long-term loyal customers, leads to
Measure twice. Cut Once. Grow your revenue as fast as you possibly can. Just make sure you plan for success. Customers rarely give you a second chance to get it right.