In Search of the Biggest Brain in E-Couponing

Being the first to launch an idea in the business marketplace often gives you a great head start as a leading authority, but it doesn’t guarantee long-term success. Because one thing is for certain: The minute you think of it, the next minute someone else is going to try to get in the game with something better.

Take the e-coupon market, for example. There’s Groupon. There’s LivingSocial. And now we have Google getting into the action with Google Offers.

All with slight differences but all still functioning from the basic premise that each day you have the opportunity to take advantage of an offer from a local business.

It’s worked well for Groupon up to this point, so well that they had to reject a multibillion-dollar buyout from Google.

But that was then. Now the stakes get raised beyond deal versus deal, the competition really begins and things get interesting.

The problem with couponing sites is that at their very core, they offer no brand loyalty unto themselves. They can offer discounts to a variety of places and, yes, if the coupons of one site appeal to you more regularly than another site, you may wander over to that site more frequently. But even if they have great deals, that’s not enough to keep you going to that one site over another.

And while the three sites mentioned are the predominant players, it’s not terribly difficult to get into the e-offer game.

The true winner in the Groupon/LivingSocial/Google Offers war will be based on four factors:

• Personalization and “learning”

• Sharing

• Mobile integration

• Vendor relationships and control

The coupon site that accomplishes all four will be the brand that wins the greatest loyalty, and that’s no minimal thing.

Personalization and “learning”

The time has passed for offering generalized buckets of coupons for a city or neighborhood or even coupons based on event preferences. The winner here will be the site with the biggest “brain.” In other words, the site that has the greatest capability to learn what you like most and suggest offers that fit your lifestyle preferences.

Much like how StumbleUpon might learn your news preferences or Pandora might learn your music preferences, it’s the offer site that learns your favorite places and connects you with them that will grab the greatest market share and loyalty. You select more, it gets “smarter” in its suggestions. You thumb it up or down (or something similar) to help it “learn.” It’s not a matter of who has this capability first as much as who does it best.

True, some people like being surprised by offers outside of their preferences now and then, giving them options to try something new. But it stands to reason that many more will want to stay within their range of things they like to do.


The ease (and fun) of sharing offers with friends is such a given that I’d almost not mention it, but it is that important. You must have the ability to share coupons with ease on any major social media channel and, assuming you’d like them to, your friends should be able to see the kinds of places/events you like to frequent so they can take advantage of those offers, too. Much like Facebook’s Timeline feature, you should be able to see where your friends went so you can get in on the action, if not this time, then the next.

Mobile integration

Pay-by-smartphone is going to become even bigger in 2012, to where you can use your phone at an establishment or venue to purchase what you need. The coupon site that integrates this functionality into its offer system is going to smoke the competition as more customers in the mainstream adopt this convenient feature and get comfortable with it. It’s not a “nice-to-have.” It’s a “must have.”

At the moment, Google’s ability to merge its Offers with Google Wallet is a strong indication of just how formidable the company could be in this area. When its programs stand alone, Google’s offerings historically can be a hit or miss. When they tie programs together, such as where you can pay with your smartphone and show a coupon, Google becomes a competitor that’s difficult to ignore.

Vendor relationships and control

Of course, when you’re talking about small-business merchants, you can’t relate to them on code alone. If the coupon war is won on the ground, you have to cultivate relationships through sales people. Groupon has a strong head start here in terms of sheer number of sales reps getting small businesses to enroll. That is, unless too many of them are overaggressive reps like the ones described by a former Groupon employee in this TechCrunch article. Yikes.

Who wins? For brand equity, it may be none of them.

I like the potential of Google Offers best in terms of the technology it utilizes. But the one Big Asterisk on all of these e-coupons for businesses to consider: From a brand standpoint, I hate it when price is the lead factor in getting someone to come through the door. The argument may be that e-couponing gets new customers you didn’t have, but I would like to see more businesses go for building loyalty among their best, most frequent customers who can spread word-of-mouth than for mechanisms that aim to get the most bodies through the door at all costs, because I’ll bet a decent number of them aren’t really that loyal as the ones you’ve had already.

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The Google Gap: Useful? Yes. Emotional Pull? Well…

A rather stunning irony occurred to me as I was thinking about the latest tool Google is introducing, Google Plus.

For all the tools I use from Google, I don’t believe I ever got extraordinarily excited about using them before or during the time I’ve actually used them.

Don’t get me wrong. I’m a fan of certain tools and highly recommend them. In particular, I regularly use Google Calendar, Gmail, Google Reader and Google Alerts. I’d even describe them to others as “great.”

So what’s the problem? The problem is despite the fact that Google delivers a highly efficient, highly productive group of tools for me, none of these tools have stirred the senses with a “got to have it now” factor. And this wouldn’t be such a big deal if Google weren’t aiming to stand toe-to-toe with the likes of Facebook to be our all-everything place for connections, searching and relationships.

Say what you want about privacy issues, but Facebook owns a great deal of emotional investment from people. It’s the place where their family and friends commonly are when it comes to online community interaction, if not their business associates too. The technology to keep and enhance those connections is important, but technology is almost secondary to why people are there and stay there. This emotion is not to be underestimated.

Take another company, like Apple. Apple has the “got to have it now” factor in spades. It’s safe to say that for a large number of people like you, there’s been at least one Apple product released in the last 10 years that you really, really wanted….NOW. It’s why people had to have the iPod, stood in line for the iPhone and they’re salivating over the iCloud. And if you didn’t have it, you felt left behind. Even with the one product that met a bit more skepticism at first, the iPad, there’s little question now that people who bought into it love what it can do on a personal or business level.

And there it is – the “L” word. Love. There are many companies that produce useful, efficient, productive products that people buy and even keep buying…but don’t love them. This is coveted territory that not everybody can own. Dare I say that Google has never produced anything that’s, well, FUN. It’s never ENTERTAINED. Absolutely, it’s helped me get the job done, find what I’m looking for and keep me organized. But it’s never brought a lasting smile to my face.

Love isn’t always attained by adding more to an existing solution but actually stripping away what isn’t needed. One of my favorite examples here is 37 Signals with their Basecamp product for project management. There’s more emotional pull here not because it’s complicated but because it’s more simple than other tools with just enough to give me everything I need, nothing that I don’t. It doesn’t hurt that 37 Signals is great at customer service and exceedingly quick to inform its customers of enhancements or technical difficulties they’re working on.

And by the way, I didn’t have to wait for an invite to use their software.

Therefore, the Google Gap has nothing to do with technology but an emotional pull. A legion of fans that are passionate about spreading the word to others unsolicited because that product enhances their life just SO MUCH that they want the people they care about to experience that feeling too.

Never had that situation with Google. Never had a “Oh wow, you’ve got to try Gmail” moment. Instead, the exchange goes like this:

Them: “What’s your favorite calendar program?”
Me: “Google Calendar. It’s great.”

That’s not love – it may sound like it at first glance, but it’s not. That’s a positive recommendation that wouldn’t have come unless it was initiated by someone else. To close the Google Gap and be seen in a different light, Google Plus and future products from Google need to be more than just useful and efficient. We also don’t need versions that seem better in appearance but in practicality are more complicated to use.  They have to bring remarkable new categories of technology we haven’t used yet or dramatically strip away the complications of technology we’re using to the point of where it almost feels like a brand new category.

By virtue of his product line, Steve Jobs enjoys this emotional capital. By virtue of the relationships he has ownership over, so does Mark Zuckerberg. If Larry Page wants to stand on the platform with these gentlemen, this is the challenge before him to shape a new chapter of the Google era.

What’s the Plus Side, Google?

The concept of the phrase, “Facebook competitor,” almost makes you giggle at this point. Kind of like staring into the Grand Canyon and imagining then and there what could be better. Oh sure, there are other picturesque places. But it’s pretty hard to imagine them being more beautiful than what you’re looking at right now.

Facebook isn’t always beautiful. Far from it. But what it does have are a boatload of relationships between existing friends and family members. And that’s going to be pretty darn tough to break.

Yet, Google is out to try anyway with their new Google+ product. To cut to the chase, Google+ sounds a lot like Facebook with its profile pictures, feeds, etc. The big difference appears to be that you can better organize groups of people – and share what you like with those people specifically rather than your 690 friends on Facebook, 10 of which are real friends. But I digress.

Great idea, Google. And yes, Facebook has had major challenges concerning privacy controls. No doubt about it.

But here’s the challenge – you don’t have to just jab at Facebook with nicer tweeks to the model. In order to dance with the undisputed heavyweight of the social networking realm, you’ve got to full-on throttle Facebook with features that kick its ass. And even if you do, you’ve got to consider just how difficult it is to motivate people to uproot themselves from Facebook and the myriad of relationships they have in place.

It’s not impossible (Exhibit A: MySpace). It’s just that where MySpace was geared to a younger audience in general, the average age of a Facebook user is 38 years old. So there are more categories of demographics that have to get in the moving truck over to Google+.

Of course, maybe Google just wants a piece of the social networking pie. But if I may put on my more demanding customer hat, we don’t just want better technology. We want tools that are easy to use and fun. Google Buzz sounded kind of interesting, but did it enhance our lives over what was already in place? Not really. Same with Google Wave – kind of cool, but also kind of hard to understand.

Probably one of the most frequently mentioned books on business is “Blue Ocean Strategy,” the concept of getting out of the same pond as many competitors and fighting within that pond like sharks. Which essentially Google is not utilizing here. It’s fishing in the same pond and saying to people, “Hey, look at this cool new pole we’ve got for you to try!” We’re looking at that pole, agreeing that, yes, it probably is nice and even better than what we have, but still not enough to make us put down the pole that we’re already using. I think we can agree at least that’s this has been the experience with Google’s most recent efforts.

Google’s had just a little bit of success with that ol’ search engine of theirs. And Gmail. And Google Reader. And Google Alerts. But if you’ll notice, several of these are in the search, research and online storage realm. Not in the “connecting with others” interactivity realm. Anything outside of this set just feels like tinkering to me.

I will say Google has this much going for it: 1) It’s a giant in its own right and 2) If you read the comment streams of articles speaking about Google+, there is a LOT of pent-up frustration about the privacy issues of Facebook. These people want Google+ to succeed and they can’t wait to try it. That raw emotion, acted upon, is going to be honestly more important to the success of this endeavor than the bells and whistles of Google+ alone.

But with all due respect to those folks, Google didn’t work on this project as long as they did just to nab some Early Adopters. To avoid being mentioned in the same breath as “Google Wave” and “Google Buzz,” Google+ has to feel a whole lot of love from the mainstream too.

I don’t think we’ll have to search too long before we know the answer.