What Helped Groupon Grow From The 400 Subscribers

1503 Words7 Pages
What helped Groupon grow from the 400 subscribers in 2008 to the 60 million it has today has been largely due to the company’s ways of understanding their customer’s behavior. One of the main reasons they were able to grow in the way they did, was due to Andrew Masons understanding of the current social trends. By doing so Groupon was able to utilize the rapid growth of the Internet and technology such as mobile applications, reaching out to their customers in a quick and simple way, solving the problem of connecting with local consumers.

With an app like Groupon or “Groupon Now”, the company does large parts of the problem recognition, for the consumer. With newsletters and daily deals the customer is constantly fed with information to
…show more content…
The brilliance of the concept is that while engaging the consumers to stay on their friends and family about the deals, they are simultaneously advertising the app and concept. Groupon is basically acting as a bridge of communication between the buyer and the seller, as the consumers may be unaware of the seller’s very existence.

Another thing leading to the success of the Groupon concept was the “Groupon Promise”. As the promise acts as insurance, this allows for consumers to be more impulsive in their spending when participating in deals and discounts. It makes the customer feel secure, knowing that Groupon is confident enough in their product to take the risk for them, providing them only the best, or they will get refunded.

In conclusion, the understanding of consumer behavior mixed with the growing social trends of technology was a crucial part in the growth of Groupon in 2008. By being able to understand consumers and the target market, Groupon were able to affect the wants of their customers and help start their process of the purchase decision using daily deals, providing them with warranties such as the “Groupon Promise” and discounted prices.

2. What is the Groupon Promise? How does the Groupon Promise affect a consumer’s perceived risk and cognitive dissonance?

The “Groupon Promise” states that, “any customer can return a
Get Access