Groupon and "OsechiGate"

It's funny how quickly things can turn for a company these days. We have been talking about Groupon, the onlinecoupon service that is "sweeping" the nation, and world.  I was unaware it existed outside the U.S., yet a commenter at this blog points us to Japan and "OsechiGate". What is OsechiGate? According to Fast, "sales for Groupon and other daily deals sites in Japan are hurting following an incident we'll call 'OsechiGate'--a bad food deal involving osechi, a decadent Japanese New Year's dish. Despite Groupon founder Andrew Mason's video apology to the people of Japan a few weeks ago, Groupon sales dropped 14% over the last month, according to Coupon-Jp(PDF), a consumer research firm in Japan." Follow this link to see what was offered through the Groupon, and what was actually delivered. Why doesn't this surprise me? The article even tries to see the light at the end of the tunnel with, "some pundits thought the event might actually be a publicity boon for Groupon, under the any-press-is-good-press theory, says SocialTimes. But Coupon-jp's report suggests otherwise. Even Groupon clones have been hurting in the wake of the incident."

I have had some tell me that in the right circumstance Groupon is useful for small garden centers. Moving merchandise that isn't selling as fast as they like, end of the season stuff, discontinued items, etc. I'll stick with what we said before about Groupon. If you want to be associated with the type of merchandising that took place in Japan or what happened recently with FTD on Valentines day then by all means use Groupon. Some will say that the quick apology from Groupon's founder after each event shows Groupon get's it when it comes to companies admitting mistakes. Well how often are we going to be hearing apologies about deals gone wrong?

When this kind of stuff happens people start to wonder where to go if everyone is trying to rip you off. According to some, retailers are basically crooks that mark their stuff up only to turn around and put it on sale, and still make a profit. With that kind of publicity what's a small business to do? Many businesses are scared and feel the only way to be noticed is through these coupon deals. Instead try connecting with your customers! Quit listening to the social media experts and PR people who tell us that Groupon or paid Tweets are the way to gain fans. We want to shop at stores where we know the people running the store, and trust them. The only way to gain those kind of fans is through honesty in advertising. Sure there are plenty of people who love Groupon and sites like that, and there are also plenty of people who like to shop at the box stores. Sometimes trying to change their minds is just not worth it. Better to focus on people who's values and needs more closely align with ours.  Let those people spread the word to their friends. That's social media in a nutshell.