Gini Dietrich

The Groupon Bubble Is About to Burst

By: Gini Dietrich | February 9, 2011 | 

Alright. I give! I wasn’t going to blog about the Groupon Super Bowl ad, but here I am.

If you haven’t seen it yet, here it is. Watch it quickly for me. Go on. It’s only 30 seconds.

Honestly? It didn’t bother me as much as it seems to have bothered CNN, the Chicago Tribune, the Wall Street Journal, and more. Then again, I’m not a China or Tibet advocate. Not that I don’t want freedom of speech and civil rights for every human being. It’s just not something I go out and rally for during my free time. Sure, I rolled my eyes. I even said out loud, “What was that?” But I didn’t find it offensive.

There were two other ads…one with Elizabeth Hurley talking about Amazon rain forests and one with Cuba Gooding Jr talking about the dwindling number of whales.

Seems alright, each one by itself, doesn’t it? The problem? Then they each go to exclaim that they got a deal with Groupon discounts, with Hurley even exclaiming, “not all deforestation is bad” while getting a bikini wax.

Tacky? Yes. Insensitive? Completely. Clever (which is what Groupon is claiming)? Um. No.

But the reason I finally got suckered into blogging is not because of the ads, but in how Groupon has handled the criticism. And, as we all know, Spin Sucks.

Have you seen Andrew Mason’s “apology?” It actually stops short of an apology, implying instead that if you didn’t get the ads, you’re just not smart. In a written, and carefully crafted letter (which I’m sure went through several rounds of drafts from their attorneys), he says, “We would never have run these ads if we thought they trivialized the causes – even if we didn’t take them as seriously as we do, what type of company would go out of their way to be so antagonistic?” He then points out how these campaigns benefited certain charitable campaigns.

I’m the first one to admit that even I, on occasion, need adult supervision. But these guys REALLY need adult supervision.

Where is their public apology, that’s not handled by the attorneys? Where are the actual words “we’re sorry?”  Where is their experienced PR counsel? Where is the sensitivity to, oh I don’t know, the fact that they’re a social company but being as anti-social as possible? Liz Strauss said it best when she gave her advice on how to heal this very public black eye.

You know what I think? I think this was another ego play in a long line of arrogance. It’s no surprise that I think walking away from the Google $6B deal was about as dumb as they come (and I’m willing to bet my life that they never see that kind of money again, even on the open market). I think this was a “HEY! We can have a Super Bowl ad! How cool is that? And we’ll work with the coolest ad agency around (Crispin Porter & Bogusky). We’ve arrived!”

But I leave you with one thought. The last time venture-backed dot com companies spent a ton of money on a Super Bowl ad to be cool, instead of growing their business, was in 2000. This game is often referred to as the “dot com” Super Bowl because it was held during the height of the dot-com bubble, and several Internet companies purchased television commercials. famously paid millions featuring a sock puppet. And where is today? Oh yeah. They went out of business.

You hear that? It’s the bubble. About to burst.

About Gini Dietrich

Gini Dietrich is the founder and CEO of Arment Dietrich, an integrated marketing communications firm. She is the author of Spin Sucks, co-author of Marketing in the Round, and co-host of Inside PR. She also is the lead blogger at Spin Sucks and is the founder of Spin Sucks Pro. Join the Spin Sucks   community!

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  • sydcon_mktg

    I agree, Gini. We werent offended watching but were like “seriously”? I didnt like when they said it was there sense of humor and that they had used other agencies before with no success because said agencies didnt share their sense of humor. My thoughts on that reply were, well are you sure your patrons are going to share your sense of humor? Is that why people buy your deals, because they lover your sense of humor?

    I also read that Groupon was not going to do a ad, but were a last minute addition due to LivingSocial buying a last minute spot. I will try to find that article, I am not sure who the authority on it was, so take it with a grain of salt, but I believe it was a reptuatable source.

  • HerzogIND

    Last comment has it. Spend your money on improving the business–don’t get suckered into allure of SB by ad folks who have grown up dreaming of getting into the big game.

  • MaureenB2B

    I agree with your points, but how do you not see this as another Kenneth Cole thing? Seems like a very similar methodology to me: tug on heartstrings re a social issue then take that attention and point it toward your for-profit effort.

  • ginidietrich

    @MaureenB2B I do, actually. But lizstrauss already did a nice job of talking about that. I see this as really weighing heavily on the Groupon bubble. It’s going to burst and that’s the point I wanted to make.

  • ginidietrich

    @sydcon_mktg Exactly! They’ve forgotten two things: 1) Their audience put them where they are and 2) They’re a social company. Now they’re talking down to their audience, instead of embracing them for change. It’s going to hurt them. Badly.

  • ginidietrich

    @HerzogIND Ego + arrogance = disaster.

  • ginidietrich

    @HerzogIND I meant money + arrogance = disaster. I’m tired.

  • dariasteigman

    I thought the ad was tasteless when I saw it. But the arrogance and tone-deafness that is Groupon is really the bigger story. I know some people have couched their critiques with a “I know these guys are really smart, but.” But … they’re not?

    You’ve picked out what was my ‘favorite’ line from Andrew Mason’s attempt to explain away their ad: What type of company would go out of their way to be so antagonistic? Apparently his, since his explanation that we just don’t get it was so offensive.

  • MaureenB2B

    @ginidietrich Love it!

  • Pop!
    Arrogance=walking away from the mega deal.
    Arrogance=the apology (or lack of) issued.
    Although I immediately went Huh? and found the commercials ridiculously insensitive, most of the folks I talked to didn’t really even pick up on anything. And the folks I talk to are fairly bright individuals, just not tuned into social messages and ad analysis like most of the folks comenting might be.
    Arrogance=they think a watered down apology will work. Issue a bland statement adn then ignore the whole situation. It will die down eventually. Lesson learned from KC and BP…or at least that’s who Groupon (leaders, PR team, attorneys) appears to be emulating.

  • JimEverett

    Gini, your post and Liz Strauss’ post are all the attention I’ve given to this topic (other than noticing a few tweets). I’m glad you got ‘suckered’ into writing this. I love the way both of you addressed it.

    “Another ego play in a long line of arrogance” is a great description. One of the interesting things about these ‘long lines’ in our lives is that we can never foresee where they will really lead. Unfortunately Groupon’s ego has been rewarded along the way, which, step-by-step, makes it easier to go to the next extreme and lose all touch with the real purpose and drivers of the business.

  • dariasteigman

    @JimEverett Rewarded them — up until now. The social coupon market is still very young. Groupon acts as though they own it; but there are other companies in play and I suspect that most customers aren’t yet wedded to any brand in this space. A lesson Groupon needs to learn, fast, if they want to be worth ANYTHING for much longer.

  • bryanwillmert

    Great Post Gini!

    I am with you on the fact that I didn’t even look at the commercial as offensive until everyone started throwing their arms in the air, but then again I still didn’t see it! I am also in agreeance that the deal to not allow Google in was a either a strike of genius or idiocy. Time will tell which of the two it was, but I tend to lean toward the later!

    Any business venture that allows arrogance in, is only steps away from destruction!

  • JimEverett

    @dariasteigman I agree they have been rewarded ‘up until now’ and with your view of the social coupon market. The danger in being so ‘successful’ is that you can start to believe all the reasons for your success are the ones you like and the ones you implemented on purpose. It appears that this is leading Groupon to do only what they like and, as you suggest, they’re likely to get results they don’t anticipate.

  • NancyMyrland

    Oooohhhh…look at these bright, new, shiny tools we have at our disposal! Let’s use some of our gozillion dollars to go play with media! Yay, this is great! We even get to hire a big-time agency to create something edgy for us that will just wow everyone! Wow! I mean, we’re wowed! Yay!

    Oh, you didn’t think it was as funny as we did? But it cost us alot of money. We sat around and laughed when those Crispy people showed it to us, and told us it would be great. Well, what’s wrong with you goofy people? You’ll be sorry because you aren’t as cool as we are if you don’t get it. You’ll see….you’ll see.

    Gini…thanks for bringing this up as it’s a very important discussion to continue to have.

  • Gini and others,

    I appreciate your perspective, but I think it’s a shame that our society is so soft that they consider these ads insensitive and Groupon’s response as arrogant. I thought the ads were spot on with capturing the voice of Groupon and they shouldn’t change a thing going forward. Quite frankly, I hope to see more tongue-in-cheek ads from Groupon as well as from other companies.

    That being said, I didn’t find any of the “PR backlash” case studies out there offensive whether it was Kenneth Cole, Motrin or Ricky Gervais at the Golden Globes. I believe the ability to poke fun at sensitive topics helps raise awareness to issues and should spur people to actually address the underlying problems that were thrust into the spotlight.

    Where does my perspective stem from? It could be my upbringing in a blue collar neighborhood in the city, my experience attending Chicago Public Schools with fellow diverse classmates who were Hispanics, Blacks, Asians, European and everything in between, or maybe I see things differently as a result of my culture being raised by Polish immigrants. Perhaps none of these are the case at all. Perhaps I just love when villains succeed, whether Michael Vick, Kobe Bryant, Goldman Sachs or even the cast of Jersey Shore.

    I wish Groupon luck and hope they prove everyone wrong. While I agree with your sentiments about a potential tech bubble, I believe that Andrew Mason, Eric Lefkofsky, Brad Keywell and other pre-IPO Groupon investors will walk away unscathed as freshly minted winners. After all, billionaires get to where they are by being driven, ruthless and with a whole lot of confidence (or arrogance as many like to say).

    Philip Nowak

  • DonovanGroupInc

    Okay – so I watched it and all I can say for me is “seriously…is this supposed to move me to use Groupon”? Their perspective on their future net value notwithstanding – I guess the true testament as to whether they survive or not when the bubble bursts as you say Gini will be determined by the market. Sometimes just because you can doesn’t mean you should and that’s how I think they should have looked at the Super Bowl ads…or is it just cause I’m out of touch with who they were trying to reach? Maybe. Finally, in terms of a public apology – how can you apologize for something which you don’t, won’t or will ever get? Next…

  • elizabethsosnow

    However, as I recall, the sock puppet got a sitcom deal 😉 I kid. Sort of. I think they did actually try to extend the mascot’s lifespan somehow…

  • Yuppers. Groupon thought they could party like was 1999.

    There is a very consistent pattern here and it points to the $6B and all the King’s Horses of Goldman-Sachs looking like a very sick li’l fairy tale in just a short while. Turns out that the real story was more like the Emperor’s New Clothes, all played out in sock puppetry for kids that thought they had much nicer toys to play with.

    Call it a morality lesson and maybe it’ll be worth it.

  • PattiRoseKnight

    At the very end of the “apology” it looked like he might apologize but he never did say two simple words – I’m sorry.

  • ginidietrich

    @PattiRoseKnight Isn’t it amazing what “I’m sorry” will do? Even “we take full responsiblity for this and it was wrong” goes a long way.

  • ginidietrich

    @elizabethsosnow I think you’re right. And I remember PetSmart offering to buy the sock puppet for a gazillion dollars. We should reinvent that somehow!

  • Gini, I always thought coupons were for grandmas anyway. Didn’t see the two other ads, but they sound even worse than the Tibet one. Sounds like a bunch of ‘creative directors’ went out on the town one night and it sounded funny at the time.
    On the up side if every firm knew how to handle a brand crisis, where would the PR world be. I say keep going startups, KC and other BeniHana, keep showing us how bad life is when you don’t have a good PR team by your side, or worse when you don’t want to listen to them and let your ego do the talking.
    I’m a big believer in the Darwin Awards and these firms are simply removing themselves from the corporate gene pool.

  • FollowtheLawyer

    Social media WOM fueled Groupon’s growth. While the company now has the critical mass to sustain its position without that cadre of first movers, why risk alienating their unpaid salesforce of raving fans? Further, why give fencesitters a reason to dislike you?

    To extend the sports metaphor, they killed their momentum by taking their own noisy supporters out of the game.

    Does that mean they’ll lose? Probably not. Will it now take more effort to remain leaders? Definitely.

    While the ads were bad, the strategy behind them was worse.

  • dino_dogan

    Thnx for this article Gini…I was going to stay out of it and ignore Groupon and Kenneth Cole but now Im off to write an article on the newly popular, apology driven, marketing strategy. I think I’ll publish it this friday…will link back.

  • G- brilliant
    I was offended to drop being on Groupon. There are TOO many competitors for them to act like they are the only game in town any more.
    Mason is apologizing left and right and eventually people are going to realize what a theft their deal is.
    Most people are not going to care and they RELY on it (the marketing was about it, see you care more about getting a deal than Tibet etc).
    But the worm is turning. Add to your pile of stupidity the japan apology this year (look it up on youtube, just as bad), the tibet stuff ticking off China (where Groupon was looking to do business, how dumb is that?), and just general bad taste
    Yes more folks are like you and not OFFENDED, but don’t they appear to be in the minority?
    Public opinion is against them and I don’t see how it helps with all these competitors nipping at their heels

  • FollowtheLawyer

    No outrage about HomeAway’s “test baby” slamming against a glass wall spot?

  • TroyCostlow

    Gini, it’s rare that I disagree with you on anything, but we are on COMPLETELY opposite sides here.
    That ad was funny, unique, and shockingly memorable.

    Groupon’s initial response was my favorite part – putting up a website that let people actually donate to each charity, with Groupon matching all funds. Phenomenal!

    If you’re upset, you ultimately have two choices: Help the cause, or choose impotent outrage while the problem persists. It’s sad that most people would rather complain than help; actions have more impact than words.

    How many of the whiners in the media actually donated money to Tibet? People who actually help the cause are the only people with any legitimate right to be upset – everyone else is freeriding.

    It ultimately comes down to this: If you completely ignore a cause and show support only through words, while ‘offensive’ people choose to act, put their money where their mouth is, and actually DO something to solve the issue – which of you is the better person?

    Apologies only work you’re sincerely sorry, and Mason isn’t. He shouldn’t be – especially since he started Groupon as a way people could donate to charities. That’s still where his ultimate focus lies. All the money that came pouring in was one of the greatest ‘accidents’ in corporate history.

    Turning down Google’s offer was smart IMHO, but that’s a separate issue. Since they’re private, we have no idea how they’ve reinvested their capital – the public only knows about one part of the company, which is easily duplicable. But my estimation is that they held out because they didn’t want to sell the other business lines they’ve created or acquired via reinvestment strategies.

    /end ranting disagreement

  • @TroyCostlow I get what you’re saying and I respect your opinion, but the logic you use in defense of Groupon has to be applied effectively across the board before it holds true legitmacy, and it can’t be effectively applied across the board. Yes, actions speak far louder than words, but according to your logic, the following must be true:

    People upset over the massacres in Rwanda have no reason whatsover to be upset about it unless they’re giving money to the cause or are boots-on-the-ground helping.

    We had no right to be outraged over the 9/11 tragedies unless we either lost family members, we’re there helping sift through the rubble for survivors, or we donated money to the 9/11 Fund.

    This must also be true as well:

    I can say whatever insenstitive jokes or remarks about the massacres in Rwanda that I want as long as I throw some money at the problem to make up for it.

    There’s nothing wrong with me take a jab at the victims of 9/11 if it means making money, because if I then turn around and donate to their cause, it completely negates any disrespect I’ve shown them.

    Groupon then donating money does negate the fact that they disrespected numerous people and efforts in the process. In fact, I wouldn’t accept any more from a company who, 3 days prior, exploited a tragedy to make money at our expense.

    If some company in Taiwan took a jab our soldiers deaths in Afghanistan and Iraq or the lives lost in the Oklahoma City bombing in an effort to promote themselves, I find it hard to believe that you’d apply the same logic to outraged Americans and media members. I also find it hard to believe that them then buying our soliders flak jackets and donating $1,000,000 to OKC would make it okay.

    Yes, we should ALWAYS look to take action where there’s injustice. But just like the US can’t be police to the entire world, each individual citizen cannot provide fiscal backing to combat every wrongdoing in the world.

    I’m a pretty level-headed guy who can appreciate a good joke, even it’s at my expense and even if it’s a bit inappropriate. This goes pretty far beyond that. I was considering giving Groupon a try, but after this, they’ll never have my business.

  • @TroyCostlow Sorry about the typos…but I think everyone knows what I meant on the errors!

  • sydcon_mktg

    @FollowtheLawyer I believe they already profusley apologized and removed the ad from their website. Still it was dispicable.

  • @jmatthicks Here here! Good job sir

  • @TroyCostlow The problem is that we live in a culture based largely on narcisssism. The argument you are making is similarly focused.

    The ads attempt to profit off of other people’s misfortune. I find that utterly disgusting in any form. A few pieces of silver do not make such an immoral display acceptable in any way as far as I’m concerned.

  • Templar

    Can I take you up on “betting your life”?

  • @PhilipNowak Is there a difference between making light of sensitive topics and making fun to gain profit? That’s my real question.

  • FollowtheLawyer

    @sydcon_mktg Like Groupon, there was no apology from the CEO, just an explanation. Last I read they’re recutting the ad to remove the baby, but the online interactive version where you can insert a facial image of your choice and see it slammed against the glass wall will remain.

    A debacle.

  • Sure, the ads were tasteless. Ya, they got the point across of what Groupon is. And I’d agree they go in line with the cleverness that Groupon portrays in the copy of their deals. But for a Super Bowl Ad? REALLY? This super bowl was the most watched television broadcast ever in the US. To me it seems like the absolute worst time to try an ad that has the slightest chance at offending anyone. I still don’t understand how those ads ever go approved. They had such an opportunity to do something great, and I think they smashed it trying to be too witty. But then again, maybe they wanted this extra press and an opportunity to show their charitable side.

    While the Living Social ad wasn’t as bad, I think they complete missed the boat too. I thought super bowl commercials were supposed to be the best in the business? I’d like to see how these ads affects both of these companies revenue in the next month or so.

  • TroyCostlow

    @jmatthicks Your arguments is strong (and the typos are fine – it’s the internet, after all), and I was perhaps too hyperbolic – but I think you’re blending two distinct ideas:
    One is the idea of being upset in the face of tragedy, which is entirely permissible & understandable in all its forms (9/11, Rwanda, etc). Empathy is one of the greatest human emotions, and its power is immeasurable. I hope people are always moved to action whenever tragedy strikes – if we lose that, the world is in horrific shape. So I agree with you on this.

    The other is being completely divorced from an issue, yet outraged when it is mentioned in a context you don’t like – and this is my primary focus in the previous rant. If you are uninvolved, you haven’t earned the right to yell at people who are involved. Impact, even with a dark sense of humor, will always trump inaction. Every time. And Groupon has done more for Tibet in the last 3 days than you or I will in a lifetime.

    The company’s goal – in my view – was simply to ‘profit from’ pointing to the fact that there is a sad humor in that we would rather watch whales than save them, or eat discounted Tibetan food rather than actually help Tibet.
    That idea can’t be transferred to most people in 30 seconds while they’re half drunk watching football, and if Groupon made a mistake it was in overestimating the audience’s ability to reason through that idea before the next commercial came up.

    We disagree, but your analogies were well-reasoned. Good show.

  • TroyCostlow

    @wabbitoid Can you explain your definition of narcissism in this context & how it impacts the argument?

  • sydcon_mktg

    @FollowtheLawyer I beleive an apoloy can be found here from Chief Executive Brian Sharples: //

  • sydcon_mktg

    @ginidietrich Here is one of the articles about the last minute ad buy to compete with LivingSocial

  • @TroyCostlow “The other is being completely divorced from an issue, yet outraged when it is mentioned in a context you don’t like – and this is my primary focus in the previous rant.”

    I see what you’re saying, I really do and I’m not just being disagreeable. But I don’t completely agree.

    As teenager and then as a Youth Minister, I spent 5 years doing inner-city work in the 4th and 5th Wards of Houston, Texas and it would bother me that people who say things like, “man, those areas need a lot of help.” but then brushed over it and began talking about their shiney, new whatever. Yes, that’s doing zero good. But I’ve also known many people who would get involved, would give up their free time and vacation days to interacting with hundreds of under privileged kids. I honestly feel like the people you’re describing, though very present, are in the minority. Most people aren’t completely divorced from the issue.

    “Every time. And Groupon has done more for Tibet in the last 3 days than you or I will in a lifetime.”

    Again, I don’t want to be “that” guy that has to be a contrarian, but I again cannot completely agree with that. Sure, Groupon gave a large sum of money to Tibet. Most of us have never given a dime, and ideally, we all should. But 99.99% of us haven’t publicaly made light of their struggles to pinch a penny off of it, either. Have they REALLY done THAT much good if their money was provided ONLY because they took a jab at them to begin with? Money does not equal doing good. Yes, money definitely helps, I’m no fool. But I’ve been fortunate enough to be able to help clean-up New Orleans after Katrina, visit orphaneges in New Mexico, and homeless shelters from Chicago, Illinois to Lubbock, Texas and I feel confident in saying most of those “in need” would refuse to take money “tainted” with the mockery of their situation, regardless of how dire that situation may be.

    If they wanted to bring awareness, there are literally an infinite amount of better ways to do so. Bagging on their situation doesn’t make the result right; the means don’t always justify the end.

    We do disagree, and that’s okay. I appreciate your conversatio and interaction.

  • DivaKatrina

    I can hear the conversation play out in the creative meeting…the Hurely deforestation is actually kind of funny – but I think it’s because I never imagined her doing an ad that referenced trimming her bush (lol). Anyway, the other two were a big stretch – and not funny. All in all, the concept should have never even been story boarded. Where was the voice of reason on that creative team? I agree with @JennaLanger – not a good time to try something that could potentially offend so many. It’s definitely created buzz, but they’ve missed the opportunity for redemtion. Andrew should have taken a cue from Kenneth Cole and just apologized.

  • timjahn

    @JennaLanger Or is the Super Bowl the best time to try such a commercial? If you’re going to stir the pot, make it a big pot.

  • timjahn

    Clearly many folks here are not fans of Best In Show. Or Spinal Tap. Or Christopher Guest in general.

    Or Weird Al for that matter.

    And that’s a shame.

  • ginidietrich

    @TroyCostlow Troy, Troy, Troy. And we had such a good day yesterday! 🙂

    I’m with you. The ad didn’t offend me. I don’t see what the big deal is. But it offended A LOT of people. To the tune of major daily newspapers picking it up. But, as a communication professional, it’s my job to protect our client’s reputations. And, if our client’s customers are mad, it doesn’t matter if you’re not really sorry. You have to be sorry.

    Just the other day, we had a client get really angry with us. I mean, yelling and screaming angry. Was it unjustified? Yes. Does shit roll downhill? Absolutely. Were we in the wrong? No. But you know what made it better? When I listened to what she had to say and then very calmly said, “I’m very sorry we made you feel this way. It won’t happen again.” She calmed down and apologized for yelling at me.

    In that situation, just like the Groupon situation, I stand behind the decisions my team made. We would make the same decision again. But the client was not happy with the decision so we have two choices: We can either say we’re sorry (even if we’re not) and move on or we can defend ourselves and lose the client.

    While that was one-on-one, this is the same situation Groupon is facing. But on a MUCH larger scale. I’m sorry works so well. Yet no one likes to use it because we think it’s admitting we’re wrong. It doesn’t mean we’re wrong. It just means we’re sorry.

    So I stick by my counsel…and I would recommend those two works to every client that found themselves in this kind of mess.

    Now if I could just learn to say I’m sorry at home.

  • @timjahn Yup, good point. It seems like that might have been what they were going for.

  • FollowtheLawyer

    @sydcon_mktg Actually, information at the link you provided supports my point: “Groupon CEO’s Non-Apology Apology Letter For Super Bowl Ad”

  • What’s interesting is that folks (including mason) are willing to say in this market, screw you if you a. can’t get the joke or b. are just flat out offended.
    The overall sentiment (public opinion and most major media talking about it) is that they screwed up, and as Gini suggests they pile on it by being arrogant and blaming everyone but themselves.
    The Homeaway folks might not be answering it quite right but at LEAST they talked to folks to underwstand WHY they were perturbed and adding the root cause of the agitation.
    Groupon and its defenders are just saying grow up everyone its ok to act like this

  • DivaKatrina

    At the end of the day, all that matters is how the ads affect sales. I missed LivingSocial’s ad (must have been getting a refill) until all the bloggers went nuts comparing the two on Monday. I siged up for LivingSocial today to check it out. Will the Groupon ads keep me from buying? Absolutely not. Had I signed up for LivingSocial had it not been for the Groupon ad backlash? Defintely not.

    I’m definitely interested in seeing their end-of-year sales $$ in comparison to 2010. Could prove to be an interesting PR case study one day.

  • sydcon_mktg

    @FollowtheLawyer Oh, I agree that Groupon didnt apologize, I was stating that the Home Away Cheif did, sorry for not being clear.

  • TroyCostlow

    @jmatthicks Man, you are so right with this: “It would bother me that people who say things like, “man, those areas need a lot of help.” but then brushed over it and began talking about their shiney, new whatever.”
    It does that to me, too.
    That’s why I liked these ads.
    That’s exactly the point of the campaigns.
    That’s why their website for this – leads with this line: “Money is one of our most important natural resources. Sadly, thousands of dollars are wasted every year.”
    Your complaint about this is at the heart of the campaign. And the site has a link to all of the charities that signed on – BEFORE the superbowl backlash – to be part of this campaign. Yes, before – the charities gave their blessing to this before the ads aired. And, like most of the companies that want Groupon to sell their products, more charities are trying to line up.
    The donations weren’t, “We got caught, here’s some money if you shut up & go away.” The donations were in the design from the beginning.

    So your comment “Have they REALLY done THAT much good if their money was provided ONLY because they took a jab at them to begin with?” is misplaced –
    If the charities that help the causes ultimately support these campaigns, what gives disengaged people the right to claim outrage?

    When it started several years ago, as, Groupon was actually about mobilizing crowds to make charitable donations. When that didn’t work as well as planned, they started mobilizing crowds to buy things. It worked pretty well.
    Now that they have the volume, they’re going back towards charity, and I think it’s awesome.

    And btw, I like having intelligent, well-reasoned debates online. It’s all too rare, and very refreshing.

  • DivaKatrina

    @timjahn Don’t forget Princess Bride!!

  • TroyCostlow

    @ginidietrich Haha I use fake apologies to shut people up too.
    And don’t we have good days every day? (well-reasoned & candid disagreements are good days, too.)

    Ultimately, it comes down to this – I think your assessment of Groupon as an hubristic & arrogant company is misguided.
    They simply have different goals, and it’s the kind of goal you rarely see in a company this size (especially one that’s grown so quickly).
    It’s one thing to run a business for profit – that’s the most common reason people work.
    It’s quite another to run a business for impact or for another outcome.
    For example: One of the reasons we have high long-term unemployment now is because companies are run for profit rather than for the creation of jobs – jobs are always secondary. If a handful of companies began running themselves with the goal of creating the highest number of long-term sustainable jobs, with jobs being first and profit being secondary, they’d ultimately make different decisions than a company whose goal was to generate the largest amount of wealth for its shareholders. Those decisions would look foolish to people who run companies with a for-profit goal. The company would break even every year. But we’d likely see lower unemployment in the US, and that’s as noble a goal as the achievement of the profit-motive.

    Different goals lead to different ways of doing things, and Groupon is focused on mobilizing large crowds and capital towards causes – or, at least they were at first when they were and had a smaller audience. They’re heading back in that direction now that they’re so huge.

    And sure, after this ‘disaster’ he could say he’s sorry to shut people up and move on. But that’s the kind of decision you’d make if your main concern was nothing more than generating the largest amount of profit via your customers – but Groupon has different goals, so they make decisions differently.
    Maybe they’ll lose a few customers. It sounds like they’ve lost @jmatthicks for good.
    But it’s similar to what we talked about yesterday – losing some customers is worth it if your engagement with the smaller group is tighter and more ‘correct.’

    If they sold that to Google, the model would be run by profit-only people who would completely ignore the myriad other ways that altruistic people could use the power of mobilizing global crowds. Giving that up would eliminate all the potential impact.
    I admire the kind of fortitude it takes to stare down $6 billion and say “Having the power to change things for the better is worth more than that.” It’s weird to see a CEO whose primary concern is impact rather than money, but it’s also very refreshing, IMHO.

  • TroyCostlow

    @timjahn Yes. Agreed.

  • ScottHepburn

    This “social media bubble” issue is bigger than people realize. It’s lingering there, quiet beneath the din of joblessness and Egypt and…whatever else. But it’s there.

    I am SO excited we’re debating this topic at our next Social Media Charlotte breakfast. Four of the smartest people I know — Adam Holden-Bache, Katey Dietz, Lyell Petersen, and Lisa Hoffmann — are gonna hash it out mano-a-mano: Is there a social media bubble about to burst?

    It’s coming… I can feel it…

  • I’m still not exactly sure where I stand on this issue, but I decided it was important to comment on how FREAKING AWESOME it is that @TroyCostlow and @jmatthicks are showing off their debating skills. Thanks ginidietrich for writing this post and creating an amazing space for people to speak. Reading these comments has helped me work through how I feel about the issue, given me new insights, and got me thinking about Groupon way more than I every would have without it!

  • This behavior reeks of immaturity, lack of experience, and poor judgment one would expect from a 20-something year old entrepreneur who just got hundreds of millions of dollars dumped in his lap. What were his advisors thinking – or not thinking?

    This is not surprising and in fact precisely what I would expect from a young entrepreneur sitting on top of the world with a bazillion dollars in his pocket who doesn’t understand the wisdom of humility while in the act of an apology.

    Shortsightedness is a flaw typically overcome by age and experience and unfortunately money has a ‘stunting’ effect on human-beings growing a conscience.

    Bursting bubble? Highly unlikely in my opinion Gini, but we’ll see…

  • The difference is, Groupon is making money and is profitable. was making little money and spending significantly more on advertising. That’s why they went out of business.

  • @TroyCostlow I am using narcissism to mean self-centered behavior that consistently excludes the outside world to a destructive conclusion. The dominant culture of the US has a serious problem with this.

    In order to accept Groupon’s behavior, we have to acknowledge that many people view a situation like Tibet only from the narrow perspective of what cuisine they are served – which is to say outside of the suffering of Tibetans, the moral imperatives of helping, etc. That, by itself could be a pardoy – and I wanted to take the commercial as a parody of this narcissistic behavior that is very popular among the US middle class.

    BUT – the commercials were lacking essential elements of satire, used well known celebrities, and concluded with a sales pitch for groupon. That cannot be taken as a parody, but as more self-centeredness.

    Where this exclusion of others becomes destructive is the implication in the non-apoology that those who were offended were at fault for taking it wrong. As Gini has now said, no matter how you feel about the moral imperative THAT is the line you can’t cross. You have to be responsible for your words and how they are taken.

    Not doing so is, indeed, narcissistc because it is destructive. I realize that not everyone has my Mennonite upbringing and I’m willing to give people some slack here and there – but when their self-centered behavior is clearly working against their own interest I will speak out and let everyone know how tiring the dominant culture gets after a while.

    And yes, this sort of behavior is very common. I am guessing that the groupon execs are very confused by the reaction about now.

  • TroyCostlow

    @wabbitoid I agree that narcissism plagues contemporary American culture, and this campaign was definitely a parody of that kind of self-centered behavior you were talking about. Although I do think you’re adding extraneous things you dislike about culture into your definition of ‘narcissism’ which are distinct from the word itself.

    Groupon’s attempt to leverage self-deprication of narcissism via sarcastic advertising in an attempt to drive more money towards themselves and the charities that signed on for their support… that’s a lot to convey in 30 seconds. It’s so many U-turns that most people get lost.

    Refusing to apologize for someone’s failed comprehension isn’t narcissistic; it’s arrogant if you disagree with them, or courageous if you do. Standing up for your beliefs, rather than acquiescing and taking the easy way out, has become far too rare.

    If they’re guilty of anything, it’s over-estimating the reasoning capabilities of the Superbowl audience.

  • @TroyCostlow As I said, I wanted to take it as a parody but had trouble because it was lacking the basic elements of sarcasm. I could only laugh at the ad to the extent I can laugh at popular culture, which on a good day is possible (but not usually around subjects like Tibet). I chalked that up to bad writing, and I’ll stand by that.

    As for the definition I’m using, I think it’s a good one and I’m shocked that you are so hung up on the word. A little Taoism would go a long way here, and if you’d rather have another word I’ll gladly sub it. Let’s not get hung up on such a small thing.

    Many people were offended by this ad. Many. The company has to take responsibilty for what it has said and done, and really has refused to do that so far. They are acting against their own interests – which goes far beyond my own little opinion.

    Beliefs? I think you should articulate what “belief” you think they are standing up for when you make a statement like that. All I see is self-centered behavior that reaches a destructive conclusion – a stunningly common thang.

  • HowieSPM

    @mikestenger But zero barriers to entry. There are a ton of these now. Including one just for Chicago! I am not saying it isn’t going to be a business that lasts and makes money. But maybe not at the $6bil valuation Google wanted to pay for it.

  • HowieSPM

    I am going to show you all something. And you are going to flip out. Groupon had a spot that would of destroyed every commercial during the Superbowl and probably would of made the SB Hall of Fame along side my friend Vinny Warrens Budweiser WHaaazup! Guys. Why this spot was rejected blows my mind.

  • TroyCostlow

    @wabbitoid You’re right, I should probably let the definitions go. Not sure why I’m so hung up on that… old habit from when I used to work in psycholinguistics, I guess. So Taoism. Yes. Noted.

    In terms of the ‘belief’ they’re standing up for, it’s this:
    Groupon is affecting change in Tibet by leveraging their crowd to make positive change via engagement and donations. The people who criticize them are doing nothing – they’re completely disengaged from the cause, yet they complain about the sense of humor of those who ARE making an impact.
    An apology grants legitimacy to the person being apologized to – and there is no legitimacy to non-action. Simply because “Many people were offended by this ad. Many” implies that the group is large, and it is, does not mean that the group is right.

    Those engaged in positive action always have the moral high-ground over disengaged whiners.
    If anything, the apology Gini asks for is in the wrong direction.

  • ginidietrich

    @HowieSPM I think they took it down – YouTube says no likey.

  • ginidietrich

    @mikestenger Great point.

  • @ginidietrich @HowieSPM I just watched it. Wow, that would have been way better! It’s a bit long, but they could say the same thing in 30 seconds. Remind me not to hire the person who made that decision.

  • ginidietrich

    @GACConsultants I always say it’s no wonder professional athlets get in trouble because they’re 22 years old and making a gazillion dollars. Your point is well taken.

  • ginidietrich

    @ScottHepburn I can’t wait to hear how this breakfast goes. You’ll blog about it?

  • ginidietrich

    @DivaKatrina I agree we’ll have an interesting case study. In 2000, I wasn’t quite experienced enough to understand what was really happening. But now, with more experience and years, I see a lot of the same mistakes being made. Just 11 years later.

  • ginidietrich

    @faybiz It’s sad that a social business hasn’t figured out the social side of saying “I’m sorry.” Screw you isn’t an option, yet that’s exactly what they said.

  • ginidietrich

    @DivaKatrina @timjahn I loved Princess Bride!

  • ginidietrich

    @DivaKatrina @JennaLanger I think the larger issue is that this clever, funny stuff works IF you’ve built a business where trust and credibility are there. But people don’t trust Groupon, nor are they loyal. Look how many people signed on with LivingSocial for the Amazon deal. It’s a coupon/discount business and the people they attract buy for the joy of a sale. There is no trust or credibility in that.

  • ginidietrich

    @Templar Oh sure! 🙂

  • CoreyTyhurst

    I think we all need to ask ourselves what the point of the ad was. If the intent was to create awareness of the brand, I’d say they were highly successful. I bet folks who had never hear of Groupon now talk about it at the dinner table in some shape or form. No publicity is bad publicity just ask Eminem… Or all of the people who feel compelled to discuss it here.

    That being said, if their intent was to make their rand family friendly, I’d say they messed up. I doubt this was the case… Have you read any of the copy on their daily deals? Their brand pushes the envelope.

    Net, I think the ad was an awesome call, but giving up the offer from Google was just silly.

  • ginidietrich

    @TroyCostlow @jmatthicks “That’s why their website for this - – leads with this line: “Money is one of our most important natural resources. Sadly, thousands of dollars are wasted every .”

    Yeah…like $12MM on a Super Bowl ad that created huge backlash for you.

  • ginidietrich

    @FollowtheLawyer Crap. I can’t keep up. I didn’t see the Home Away one! But I did LOVE the Career Builder one with the monkeys. I love monkeys!

  • ginidietrich

    @faybiz I agree public opinion is against them. And, when you have all of the national media lamblasting you, you should just shut up and apologize.

  • ginidietrich

    @dino_dogan I can’t wait to see this!!

  • ginidietrich

    @johnfalchetto HAHAHAHA! Coupons ARE for grandmas! LOL!!

  • ginidietrich

    @CoreyTyhurst Ah see…that’s where you and I disagree. I think there is such a thing as bad PR. Bad PR equals decreased value 99.9 percent of the time.
    But I do agree giving up the offer from Google was just silly!

  • ginidietrich

    @JennaLanger @HowieSPM I agree THAT would have been awesome for them to use…in 30 seconds.

  • CoreyTyhurst

    @TroyCostlow @jmatthicks This “backlash” actually makes me want to buy more from them… I wonder who their target demographic was for this campaign?

  • KenMueller

    @CoreyTyhurst @ginidietrich I think that with the nature of the web, we are well past the “no publicity is bad publicity” argument. I think with the real-time nature of things, reactions come fast and furious. you no longer have any meaningful amount of time to put any sort of spin on things. Just ask the 26-year old Congressman from NY who resigned. I think there may be SOME business categories where any kind of publicity is ok, but we’re less than willing to put up with things because we ALL have a megaphone in our hands 24/7 with things like Twitter and Facebook.

  • @TroyCostlow Ok, here’s where we disagree, I think:

    I don’t see that there’s any moral point for them to defend. You seem to think that they are “right”, and I honestly have no idea what that means in this context. I really do not.

    Once again, I was offended by this ad but I’m used to being offended and usually say nothing. My hunch is that you’ll be more or less the same on this point eventually. It’s a big world and we all see things differently.

  • FollowtheLawyer

    @ginidietrich Darth Vader kid. Completely winning and memorable. It was a great ad that works because its simple, wordless narrative connected family values, surprise/delight and “magic” with the Volkswagen brand.

    I think those Career Builder monkeys drop kids off at my son’s school every morning.

  • paulevansmedia

    I hear the bubble bursting too … Mason walks away from the best offer he’ll ever get, competitors are birthing faster than Rabbits and now a Rice University study takes some of the shine off online couponing … Groupon As The Emperors Tailor? | Evans Media Group

  • HowieSPM

    @FollowtheLawyer @ginidietrich @sydcon_mktg The career builder one was great. But I tried using career builder in 2007 and it sucked royally. It was horrible. The only good thing was for recruiters to see my resume and contact me. Now technically LinkedIn can be used that way.

  • TroyCostlow

    @wabbitoid “Right,” as I use it, is an abstract, derived from the idea of one group having earned more authority on a subject by being in greater conformance with an objective morality – in the case of charity, people who spend time and capital to make an impact are more ‘right’ than people who do nothing.

  • TroyCostlow

    @ginidietrich @jmatthicks Haha, “Yeah…like $12MM on a Super Bowl ad that created huge backlash for you.”

  • angiecat

    The ads were barely funny — but they were unique, and shockingly memorable. I’m not a fan. Walk away from a Google $6B deal. Yes, arrogant decision making will lead to their demise. ~ Angie Gibson | Blue Poppy SEM

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  • ElissaFreeman

    I once had a CEO who used to kibosh uber-creativity as being “too clever by half”. I’ve always lived by those words…as you’ll never make any friends by always wanting/needing to be the smartest guy in the room. After awhile, all that bravado wears thin…just ask Mark Zuckerberg. Andrew Mason is clearly sucking back his own Kool-Aid…and one of these days he’s going to choke. Let’s just hope the rest of us survive what could be his ultimate demise….

  • ginidietrich

    @ElissaFreeman Remember when Dennis Miller was on Sunday night football and he didn’t last the entire season because people didn’t get him? Same thing.

  • ginidietrich

    @angiecat It’s funny – all of us girls think that move was arrogant. But the guys think not so much.

  • ginidietrich

    @paulevansmedia Oh! I haven’t seen the Rice study. I’ll check it out. And “birthing faster than rabbits”. LOL!

  • paulevansmedia

    I have to disagree Elissa … Dennis Miller talking about measuring first downs in angstroms may have missed 2/3 of the audience with his brilliant humor (and eletist as this will sound … it’s their fault not his) … he never used the plight of others – not even the ignorance of his viewers – as a comedic foil. And while Groupon was nowhere near the blatant vulgarity of say, Lisa Lampanelli … their agency should have been smart enough to steer them away from stiring up people’s sensibilities … unless of course, that was the plan all along.
    If Groupon really does have a global conscience and wants us all to consider the plight of the rain forest, the Humpback and the people of Tibet, why not just make a billion dollar donation to those causes … and while I don’t use Groupon because it actually hurts small businesses in the long run, I will agree with the comment earlier, that there are certainly more people talking about them today, than there were last week. Of course, that’s just my opinion … I could be wrong.

  • adambrooks

    I am receiving a refund for my unused coupons and closing my account. Want to make a statement? Yes, “save the money” by taking it elsewhere.

  • 3HatsComm

    @jennalanger I thought LivingSocial was ok but agree w/ lackluster SB ads. Too many were just MEH, like many of the car ads or phone companies, even some of the beer stuff disappointed. It’s a fine line.. trying to be witty, edgy and memorable w/ out the risk of offending. FWIW.

  • cjstem

    I completely agree. The ads were bad. The response was worse. I had to blog out my frustration too. You can check out my thoughts on their response here, but mostly I just wanted to affirm everything said here. It was not clever, and Groupon’s response has been arrogant, narcissistic and deplorable.

  • 3HatsComm

    Wow some great discussion here. Like many I was not as offended by the ads as others, but thought there were in poor taste. Possibly b/c I didn’t know/get the connection to any altruism or specific cause. Just felt manipulative. I thought one of the Pepsi Max ads dumb, w/ poor racial overtones. I thought most of the ads were just MEH. Which makes me question what if any market testing was done prior to running the ads.

    What I do agree with @ginidietrich is the tone of the response, and I’ll let you pick your own adjectives. The “pass the buck” mentality and odd rationalizations: i.e. they don’t want ads “built around the crass objectification of women” and yet run spot w/ a thin, glamourized super model touting bikini waxing. That ad was more on its “social agenda” point, yet one could cue some “beauty obsessed” feminst rant. The other thing as you say is the lack of “social” for a social company. Looking at the comments left, a lot of negatives and not one reply from Groupon that I can find. FWIW.

  • Funny I immediately thought of you when I saw those crappy comercials and wondered what you would have to say about them.

    Oh and I hope they never get offered $6B or more again, the interwebs without Gini Dietrich would suck worse than Spin does.

    Happy Birthday!

  • @TroyCostlow “The donations were in the design from the beginning.”

    Again, the end does not justify the means. Why do something noble in an “unnoble” way that you KNOW will create public backlash? That’s like saying, “I’m going to raise money for the 9/11 fund. And how? I’ll create outrage by portraying fire-fighters families weeping, and than pan over and say that X deal is so good is worth crying over too!” No. The means do not justify the end.

    Their original purpose when founded does nothing to support their case either. Things change, people change…and in this case, I honestly believe money was the catalyst for that change. They simply made a mistake, and I can accept that. They wanted to raise money but did it in a way that was disrespectful, albeit clever. They then refuse to properly apologize for it. I can’t accept that, the means nor the lack of a proper apology.

    In a world where most people try to avoid facing the fact that they were wrong, try to spin everything with some degree of relativity, the fact that there IS such a thing as right and wrong as well as such a thing as apologize for offending, even if you think you’ve done nothing wrong. They refuse to do either, and that is wrong.

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  • CLGraphics

    Those commercials, combined with their 6$b snub brought an instant image to mind:

    ‘Red’ from That 70’s Show, setting down his coffee, shoots ‘that-look’ across the breakfast table at ‘Groupon’, says … “Dumb-ass”, picks up his paper ignoring the indignant ‘What? Why? Me?’ look on ‘Groupon’s’ face.

    Funny what happens when you ‘try’ to be cool…

  • TroyCostlow

    @JMattHicks This has been an awesome exchange, and we should probably wrap it up soon – especially since Groupon pulled the ads.

    The 9/11 description you just left is what Kenneth Cole did – the subject of ridicule is the tragedy. That’s not the case with Groupon, who was using self-deprication to mock consumer-fueled narcissism.
    We all spend on ourselves instead of on causes. It’s rather selfish, but we overlook it all the time.
    Last weekend, my friends & I spent $200 at a Ethiopian restaurant. You eat the food with your hands by using this crazy bread-thing… it was delicious. Highly recommended, it if you’ve never gone.
    You know who doesn’t spend that much at Ethiopian restaurants?
    Our meal – one meal – cost the equivalent of 1-2 YEARS of the average Ethiopian’s salary. That’s morally repugnant.
    We could have gone to Subway for $20 and given the extra $180 to an Ethiopian charity. But we ignored the socially-positive opportunity cost of that expense and ordered so much that we wound up throwing food away.
    Think of how much was thrown away at Superbowl parties. Or how much money will be spent on the stupid things advertised in so many of those ads – money that could go to much better causes.
    We know about that, we ignore it, and most of the time, we’re pleasantly distracted by shiny things so we don’t think about the other socially-positive uses of our money.

    THAT’S the joke. That we, as Americans, especially during the superbowl, do that all the time. We are the subject of the joke – not the tragedy. In order to make that joke, you need to reference a tragedy. It doesn’t work without that. But the joke requires that narcissists are self-identifying (which we’re often not, so it’s a small group), that we have a self-depricating sense of humor (and it’s rare that people can laugh at themselves concerning ‘big’ issues, so that’s an even smaller group), and that we would be able to put this together in a matter of seconds (which we obviously can’t during the superbowl, because we all have ADHD).

    So many people just completely missed it and demanded an apology for their own misunderstanding.
    That’s like giving Moby Dick a 1-star review because “It wasn’t a good how-to book on whale-hunting.” Or The Count of Monte Cristo a bad review because “I thought it would be about sandwiches.” It’s not the responsibility of the author to clarify their point to people who don’t get it.

    Considering the volume of the outrage, it makes sense that Groupon pulled the ads.

    It saddens me when crowd size and mob rule trump objective morality.
    That happens a lot, and for some reason – I’m not entirely sure why – it always bothers me on a personal level. It shouldn’t, but it does.

    One last question – and I do look forward to hearing your response on this, as I have with your other responses. It’s rare to see discussions so clearly laid out, with quotations and external evidence. Good show. I look forward to more.

    I’d like @ginidietrich ‘s response, too since it’s a direct question about the title of this blog. I may hold off on a reply, simply in the interest of time & getting on to other things. This has been a great discussion, but it has to end some time…

    My final question is this:
    An insincere apology – when you’re not truthfully sorry – is a deliberate falsification of reality in an attempt to manipulate another person. How is that different from Spin?

  • FollowtheLawyer

    @TroyCostlow @JMattHicks @ginidietrich Spending a week deconstructing the signifiers, objects, interpretants and exquisitely cerebral satire of Super Bowl ads? How about Semiotics Sucks? 🙂

    Folks, we’re not discussing Swift, Voltaire or Commedia dell’Arte.

    They were ads — commercial speech designed to elicit mass response with a favorable commercial outcome for the advertiser. Since they’ve been pulled from the air, I’m guessing that while they might have been brilliant social texts, they were not effective ads.

    Or was that all part of their brilliant plan from the beginning? [Cue ominous music]

  • FollowtheLawyer

    @TroyCostlow @JMattHicks @ginidietrich
    Spending a week deconstructing the signifiers, objects, interpretants and exquisitely cerebral satire of Super Bowl ads? How about Semiotics Sucks? 🙂

    Folks, we’re not discussing Swift, Voltaire or Commedia dell’Arte.

    They were TV ads — video performances designed to elicit mass response with a favorable commercial outcome for the advertiser. Since they’ve been pulled from the air, I’m guessing that while they might have been brilliant social texts, they were not effective ads.

    Or was that all part of their brilliant plan from the beginning? [Cue ominous music]

  • @TroyCostlow @JMattHicks Does it make sense for the bastion of “Deals” and perpetuator of “commercialism” to be calling out the masses?
    Even while pointing out the issue of the charities, it makes them disingenuously saying “look at how bad you consumers are, ignoring the plight of these charities just for the sake of a few deals.” Now, “sign up for more of ours deals.” BS pot calling the kettle black- they got called out for it, but in this day and age of Youtube, the ads will NEVER be “down.” Groupon removed them from their site, but now they are all over the internet.
    Moral outrage just doesn’t get the mileage today.

  • @FollowtheLawyer @TroyCostlow @JMattHicks @ginidietrich Do people really talk like this..?

    If you’re a trial lawyer, certainly you must leave some scratching their heads – haha

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  • FocusedWords

    Has anyone followed the latest flub? Seems Groupon suggested to FTD that they increase their price so that when Groupon was used, the price of the flowers would come back to the original price.
    Who could possibly be advising these guys??? Must be watching too much Mad Men.

  • ginidietrich

    @FocusedWords Oh yeah. I saw that. I think they ended up pulling the offer before Valentine’s Day. The funny thing is that Mr. D said, “Why would FTD do a Groupon for Valentine’s Day?” And then we find out it wasn’t actually a deal. Sigh…

  • FocusedWords

    @ginidietrich Overall opinion….Andrew Mason must have skipped any marketing/pr classes and probably doesn’t listen when advisers say “I don’t think you should do that….”

  • ginidietrich

    @FocusedWords I think it’s that, plus he’s a gazillionaire at a very young age (it’s the same thing you see in sports – money breeds arrogance), he doesn’t have enough age to have experience, and his investors are notoriously arrogant. I’m not so sure it’s him as it is his investors and no PR counsel.

  • @FocusedWords holy cow…. that is nuts.

  • @FocusedWords @ginidietrich G- I think it is because they are run by sales department and nothing resembling executive experience

  • FocusedWords

    There comes a time when the little voice in your head says “Maybe I need to get better help.” I’m beginning to think that the little voice is on mute at Groupon. Youth is beginning to show and create serious cracks.

  • ginidietrich

    @FocusedWords Totally agree!

  • ginidietrich

    @faybiz They do do sales really, really well. And maybe just aren’t experienced enough to say, “we need outside help on these things”?

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  • FocusedWords

    @ginidietrich @faybiz They have to have the best sales force out there. I have never understood how any business (especially small business) would buy into their model. Thought I was the only one out here thinking “The Emporer has no clothes.”

  • ginidietrich

    @FocusedWords @faybiz I’ve done a lot of investigating on it because clients always ask if they shoud do it. We recommend Groupon (or a similar business) if they have something that didn’t sell or they have overstock. It’s great if you need a quick increase in sales, but not so great if you expect people to come back. I’m a fan for certain things. What I just don’t get is walking away from $6B and the decisions they’ve made since then.

  • HowieSPM

    All I can say is you have driven so much traffic here just from Groupon and Brogan! You truly are Brilliant!

  • ginidietrich

    @HowieSPM If I were doing it on purpose, it would be brilliant. I’m just being me…talking about how crazy our industry is and trying to make the spin stop. 🙂

  • HowieSPM

    @ginidietrich Spin? My people invented the Dreidel you can blame us.

  • @ginidietrich @FocusedWords @faybiz
    G- there are so many competitors out there now- I don’t see how they can keep up once people see that they don’t need to give up 50% or more for what is a glorified email list and bad customers. I am sure some convert but most of the studies are not bearing it out. The alternatives are going to start competing where Groupon isn’t like ACTUAL good deed, charity stuff and not ripping off the smaller businesses for high percentage.

  • had to Digg this one…

  • austintyler

    Risks for good return. When most people think of Groupon, they think of massive discounts on the order of 50 to 90 percent. I read this here: <a title=”Is Groupon a danger for smaller businesses?” href=””>Does Groupon hurt small business</a> That spells major money for companies with a high-margin that can deal with the crazy flow of new customers. However, Klein of Bloomberg Businessweek suggests that small company might actually be taking a loss when it comes to discount websites like Groupon, LivingSocial and BuyWithMe.

  • ZZidan

    word. Groupon is overly arrogant and is starting to ignore (or rather customers are starting the realize) the neglect toward individual interests…o yea, sign me up for a spider vein consultation, or don’t, and for many business owners it doesnt pay to run a groupon deal

  • ginidietrich

    @ZZidan There is an anti-Groupon movement?! LOL!

  • FocusedWords

    @Ginidietrich While this topic has been dormant for a while, I just ran across this article which explains a whole lot about Groupon and its business model.

  • FocusedWords

    Oops, it helps to put in the link doesn’t it?

  • bryanwillmert

    @ginidietrich driving home from minneapolis yesterday i was listening to diggnation and they were going through talking about that groupon hasn’t even been profitable at this point. they have brought in revenue but they are spending more than they are bringing in and the majority of that spending is on advertising oversees. that could also cause their bubble to EXPLODE! 🙂

  • @FocusedWords While that’s a good article, here’s a study with a bit more depth that shows just how terribly flawed the business model is: Basically, it’s a consumer-based model with very little for businesses, which is why none of my clients have tried it.

  • paulevansmedia

    Here’s one from the Financial Times op-ed the other day … hinting at founders lining pockets and a ponzi-like model that has Groupon using new suckers money to pay old suckers off … Groupon is at a loss to justify itself

  • FocusedWords

    @wabbitoid I have been looking for the logic that a business would use to run a Groupon coupon. Still haven’t found one that makes any sense to me. Within my niche, the RV Park industry, we have a couple of groups that have convinced parks to sell their sites at a 50% discount. While their biz model is a lot more logical, I see the same basic problem. People who buy deep discounts, don’t return to buy at full price.

  • FocusedWords

    @paulevansmedia Doesn’t it make you question Google’s thought process behind offering gazillions for Groupon? Does for me.

  • @FocusedWords @paulevansmedia I think google got very lucky – dodged picking up groupon for too much, snagged PostRank on what appears to be the cheap. Big wins all around for them.

  • @wabbitoid @FocusedWords @paulevansmedia Google wasn’t looking at the tech (like so many other purchases) they wanted the capability and talent. They had been working on their own deals, but they wanted the Groupon infrastructure of sales people, which is the majority of what powers getting daily deals done.

  • FocusedWords

    @faybiz @wabbitoid @paulevansmedia Interesting!! I hadn’t thought of that angle.

  • @faybiz Thank you! I enjoy being called out, and you did it well. I was wondering what google was up to because they are usually pretty smart, and this makes sense. Only feel dumb that I didn’t think of it. 🙂

  • @FocusedWords @wabbitoid @paulevansmedia have you seen this hilarity?

  • @faybiz Wow. What amazes me about the times we live in is how much self-centeredness is advancing as an art form. >shudder!< A great example of the state of this art.