We have been waiting for a “next big thing” since Twitter went mainstream some years back. Could it be that Groupon is going to be it? I am coming round to thinking it might be because it has a number of characteristics I find attractive.
1. It is relevant and real time
Groupon is about stuff that is happening right now in your area. It is very specific, relevant and useful – all the hallmarks of what the world of social media (i.e. the world where information is not married to expensive distribution technologies) is all about. No-one is going to ask the question “why should I bother with Groupon” in the same way people still ask “why should I bother with “Twitter?”. When you see what it does, it is obvious how you use it.
2. It runs with the community tide
I have always believed that the “next big thing” in social media would be a new behaviour rather than a new tool and I have also believed that this form of behaviour would be linked to the formation of communities. In particular that people would get together within communities to manage their interactions with institutions, in preference to allowing themselves to be managed within communities controlled by institutions. While Groupon is a tool it sort of fits the bill in that a large part of what it does is based around the creation of communities – communities of purchase. And also that it effectively provides a medium within which individual consumers can manage their interaction with brands.
3. It uses editorial narrative
The unique feature of Groupon is that it has an editorial department of 400 people to effectively “write the ads”. This recognises that the one-size-fits-all approach to creative that characterises traditional advertising just doesn’t work in social media, which is a medium much more adapted to stories and storytelling.
4. It makes money
For the outset, Groupon has a real business model for making money that is rooted in what it does as a business. It doesn’t rely on the Facebook / LinkedIn approach which is all about building a user base first and then trying to impose a revenue model on top. In this respect, it is akin to Demand Media – another company I like – in that its business model is 100 per cent adapted to work in the social space and aligned against how its customers use the service. This is unlike Facebook or LinkedIn who try and raise revenue on being a media platform or information channel to their users when their users actually use the service as a communications infrastructure.
Certainly – if I had money to invest I would far rather invest it in Groupon than in some personal data storage facility like LinkedIn.