Groupon, the Pulse of Digital Collective Bargaining
Groupon is a Chicago-based online company. They combine the collective buying power of individuals and communities offering great deals from wholesalers and retailers. This round of funding, for $30 million, was led by Accel Partners, a VC firm with investment money tied to sites like Facebook.
Groupon’s successful PR campaigns include a grassroots section of their company, and the related “One Groupon, One Free Meal” campaign. The campaign has Groupon donate a meal for every food and drink Groupon purchased in each participating market.
By engaging with grassroots campaigns, Groupon makes an appeal to the community where they are located. Engaging with a community, especially from a media perspective is good public relations, and appeals to the everyday consumer.
“One Groupon, One Free Meal”
The “One Free Meal” campaign stretches over six cities and six local harvests.
- New York’s City Harvest
- DC’s Central Kitchen
- Atlanta’s Community Food Bank
- Greater Chicago Food Depository
- Phoenix’s St. Mary’s Food Bank Alliance
- San Francisco-Marin Food Bank
The campaign resulted in over 200,000 meals donated to the hungry. In its third year, the grew from one city in 2013 to six in 2014.
“We’re proud to partner with six amazing hunger organizations across the country for the two-week-long One Groupon, One Meal campaign, aiming to fund tens of thousands of meals,” said Kyle Klatt, Program Manager, Groupon Grassroots and Cause Marketing at Groupon. “Groupon Grassroots is committed to help build and support the communities around our thousands of local merchants.”
Campaigns like “One Groupon, One Free Meal” helped Groupon grow faster than other startups. It’s become a model of a successful internet based company.
Groupon is active in 26 U.S. cities, and more funding means more cities. The premise behind Groupon is targeting specific markets and emails sent to subscribers offering local deals presenting a win-win for sellers and buyers.
Simply put; leads, product targeting, reduced advertising costs, and a whole range of other “pain points” are solved in one fell swoop. Groupon may become a sort of discount Amazon if they play their cards right.
CEO Andrew Mason confirmed the company’s expansion and the need for deeper and more flexible technology to cope with the growth:
“We started getting a lot of interest from people looking to invest in the company. We knew some extra money could help us increase our rate of customer acquisition and focus on building new technology, and, just in general, grow faster.”
Growth from the Start
Groupon was profitable early. The mailing list for the company grew from 400,000 last year to well over one and a half million this year. Groupon created their blueprint for success.