Oli Norman, Founder and MD of itison.com talks about the future of the Daily Deals industry ahead of Groupon’s IPO.
In the Daily Deals industry, there are the Good, the Bad and indeed the Ugly.
The Good, like itison.com, focus on customer service, favourable business terms and quality deals. The Bad, like Groupon, focus on rapid growth and increasing revenue. The Ugly are hardly worth mentioning, they’re the lower end, opportunistic companies which very quickly flounder.
Sadly, the Bad and the Ugly leave behind them a wake of disgruntled customers and seriously damaged businesses.
Groupon are probably the worst offenders when it comes to mis-management of reputation, at least on this side of the Atlantic anyway. I’m not saying it’s not their fault but I don’t think that their CEO will be aware of how out of sync their UK and Europe practices are with the best practice policies they apply in the States.
Their reputation is simply a consequence of rapid growth through acquisition, which is itself a consequence of prioritising growth over sustainability.
But Groupon’s reputation isn’t all bad news. It’s left the marketplace wide open for reputable operators like itison.com and we’ve capitalised on positioning ourselves as ‘not Groupon’.
Thankfully for Groupon, I don’t believe their reputation will have any bearing on the success of their IPO. The Daily Deals business model is, at it’s very core, an incredibly powerful one and, at the end of the day, Groupon is the world’s biggest Daily Deals operator. For now at least.
Our own priority is to overtake Groupon in the Scottish market early in 2012, and we’re on track to do that through the continued quality of our deals, exceptional customer service, further expansion across the UK and also through diversification of our products. We’re launching an exciting new product in January which should push us ahead of Groupon in both members and revenue. Innovation is at the heart of what we do and we believe that it will play a big part in our continued, sustainable growth as a company.
Whatever the outcome of Groupon’s IPO, Daily Deals is a business model which is here to stay. Their mis-management of growth may have created the illusion of an industry ‘bubble’ but all of our own metrics point to the fact that the business model is not only robust but one that will be here for a long time to come.