A business can't thrive without customers, and for that reason, the efforts of marketers are often focused on new customer acquisition.
Unfortunately, many companies neglect their existing customers and one of the reasons this happens is that they don't ask a simple question: who are our customers?
When former Apple SVP of Retail Operations, Ron Johnson, took over as the CEO of American retail giant J.C. Penney, he had hoped to do for his new employer what he had done for Apple, where he led the development of the Apple Store and its Genius Bar.
Unfortunately for Johnson, the revolutionary tactic of ditching discounts and offering consumers straightforward low prices every single day of the year, turned out to be more disastrous than revolutionary.
Based out of the 7thingsmedia New York office, I was glad to attend this week's Linkshare affiliate network Symposium.
The networking-heavy event had various sessions that were packed with affiliate insights, tips and best practice processes.
However, one session which particularly caught my interest was with Andy Hoar from Forrester Research on the Direct and Indirect value that affiliates deliver to advertisers.
There are a lot of skeptics when it comes to whether merchants should use group buying sites like Groupon.
For good reason too: there are enough horror stories to demonstrate that heavy discounting and lots of customers can be a really, really bad combination.
But the viability of group buying sites themselves is increasingly called into question. Groupon, the 800 pound gorilla of the space, went public last year, giving everyone a glimpse into is finances. Finances which showed lots of revenue but heavy losses.
Q: Why have there been so many cataclysmic stories over the past year about digital discounts-gone-haywire?
A: Because too many people had no idea what they were doing.
Marketers are almost guaranteed to get discounting campaigns wrong if they don’t understand a few underlying strategic concepts about what a discount is – and isn’t. Aiming to forestall any repetition of this maladaptive behavior, Econsultancy is pleased to share a few points from our latest Smart Pack, The Fundamentals of Digital Discounting.
Businesses may be tiring of services like Groupon, and overaggressive retailers may have bargained themselves into a less profitable holiday shopping season, but one thing is for sure: consumers love discounts.
Who can blame them? The global economy nearly collapsed in 2008, and it's been tough since then. Companies eager to separate consumers from their hard-earned dollars have often had little choice but to lure customers in with prices too hard to pass up.
Thanks to companies like Groupon and LivingSocial, group buying has rapidly grown into a multi-billion dollar market in just a few short years.
The reason: group buying offers both consumers and businesses a deal that's too good to pass up. For consumers, there are steep, limited-time-only discounts on products and services. For businesses, there's the promise of a flood of new customers.