Group Online Buying: The Inbound Marketing Consultant’s Challenge

Inbound Marketing Consulting and the Group Buying Phenomenon

Group Online Buying: The Downside – Long Term

As the various group online buying sites pop up and local businesses rush to cash in on the latest online gold rush, inbound marketing consultants are in a difficult position.

This video is a conversation that attempts to explore the tenuous position local businesses are in!

As the race for riches takes off once again and historical precedents are seemingly ignored,  many businesses attempting to break out of the recent economic downturn may in fact be placing themselves and their livelihood at risk.

Inbound marketing consultants have a responsibility to be well-informed and advise appropriately as the debate continues and intensifies. I hope this helps as group online buying may may alter the face of e-commerce for quite some time to come.

Contact me anytime and I would love to get your take on all of this here. Please leave a comment below, perhaps answering the following question:

Do you think Group Online Buying is here to stay and what are the risks to small and medium-sized local businesses?

John Zajaros
The Ultimate Internet Image
Lakewood, Ohio 44107
440-821-7018 (cell)
216-712-7004 (office)

Note: GM seems to be recovering. However, whether you call it a bailout or a buyout, there can be little doubt that Pandora’s Box, opened several decades ago with the introduction of massive incentives certainly contributed to the collapse of a worldwide institution; and, the end of this corporate giant, as we once knew it, is history. The question? Will history repeat itself? Surely, the way the automobile industry conducts business at the retail level has been profoundly and forever altered. I get a bit worked up at times, particularly when David meets Goliath and the outcome is still in doubt. If you stay with me until the end of the video, I think you will understand why! Thank you for stopping and don’t forget to leave your thoughts.

Excerpts from Social Media: The Perils of Group Online Buying

Groupon and Google Battle for the Group Online Buying Bonanza

The End Result: The Local Businesses Will Lose…Big!

Question: Why would local businesses give away products & services for 1/2 the retail price? What kind of buyers are drawn to those incentives?

Answer from Facebook Friend: I don’t know, but after Groupon’s take it’s more like 25% of retail price. It’s good for Groupon, hence their now $15 billion valuation (Google was trying to steal it at $6 billion). However, I don’t know how good it is for the small business in reality. Bottom line is it’s free to start, and that’s not a hard sell (even if they lose money later on – Groupon doesn’t mention that).

My Response: The pitch to local businesses is suspect and the type of customer/client the local businesses will draw is the one looking for a ridiculously low price. The local business is being sold on the idea that once they get the client through the door that first time, they have a shot at building a list, being able to make them future offers, and being able to get them back again for a more profitable transaction…and a lasting relationship.

My questions are myriad but the number one issue here, and the thing the local merchant will never be able to recover from, never be able to turn that clock back from again, is the discount…that ridiculously low price and margin!

Ask a GM executive if they were able to sell vehicles as consistently, and at the kind of margins they once were able to, once rebates and incentivized financing were introduced. Yes…and no!

The fact is, once the incentives were introduced, buyers were conditioned, very much like Skinner’s pigeons, to buy only during incentive periods!

When incentives were not in play, either rebates or financing, sales plummeted and vehicle sales at the MSRP, with the expected margin, disappeared.

Beware the Sirens’ Call!

By introducing this sort of sales platform, complete with incentivization?

With the local merchants’ already close to the bone margin?

In the hope that there will be some magical carryover?

Ridiculous, foolish, and extremely short-sighted!

The local merchants are betting on the “come,” as in future income.

And Groupon, Google, LivingSocialDealsSuch a deal for you, you won’t believe!and the rest of the online deal brokers (read: sharks) rushing in to get their share of the profits during the feeding frenzyI mean offer…will be the real winners!

Who is going to be aced out of the transaction when Groupon becomes the local Amazon…or Google for that matter?

Think about it!

The local merchants that got the entire thing going, that’s who!

Who is also building that shared list of all of those bargain seeking clients?

This smacks of the same sort tactics companies have used since, well, since Christ left Chicago, to build businesses on the backs of others.

Take the franchise model companies have used, and still use, to build a huge regional presence when capital was lacking or nonexistent.

Who managed to pull those franchises back into the fold?

The parent companies gobbled them up once it had built the necessary infrastructure, along with the capital, on the backs of the franchisees.

And who was left out in the cold? It happened again, and again, and again! Even a certain hamburger company pulled this in the mid-70s and into the 1980s!

It will happen again, in one way or another, because regardless of the setting, people fail to learn from history!

Mark my words, I will say it again…it will happen again!

Final question:

What does it cost Groupon or Google or whomever to offer merchandise offered by, inventoried by, the local businesses?

Even the “affiliates” are paid on the “come!”

Great deal for everyone BUT the local businesses!

The Pied Piper is selling the Emperor’s Clothes, so get on board! The Sirens’ Call says it all…

Nope, nothing wrong here!

Right Cujo?

More to follow!

John Zajaros
The Ultimate Internet Image
Lakewood, Ohio
440-821-7018 (mobile ~ call anytime)

The Simplicity of Search: Understanding Search and Inbound Marketing

Inbound Marketing and Search-based Targeting

Chasing Traffic is About Getting Them to Uncover You!

The point of Internet listings, complete with creating effective domain names, is to get in front of as many searchers as possible. They aren’t looking for you, they’re looking for a service based on a simple search term that expands as the search fails…thus leading to the long tail!

First, set aside your ego!

People are not looking for you online, they’re looking for a specific solution. If you happen to have incredible brand awareness and can solve their problem? Great! Maybe you are Dell or BMW or State Farm. However, as a rule, online consumers will not type your name into the search box, they’ll type in the search term that satisfies a specific need, requirement, etc.

Something you probably already know:

If they’re typing your name in to the search box? You should be spending your marketing effort (read: cash, money, resources, keesash, moola, bread ) elsewhere!

The secret to online success, inbound marketing success, Internet commerce success?

1) Get in front of as many people searching for what you are already offering

2) Offer a product searchers are already seeking out

3) Get in front of a trend based on viral marketing mojo

Number 2 is the secret to real success online, get in front of a lot of people seeking a given product or service.

Number 1 is what most businesses do because they already have a lot of stuff to sell and have experience selling it in the offline world.

They think, “Hey! It’s just another market and we can simply do the same thing in this slightly different venue, with some of that new-aged Internet inbound marketing stuff…right?!”

“Yeeaaah!” Jon Lovitz would say, “that’s the ticket!”

You can indeed be successful exploiting Number 1! If you are creative and remember a few rules, rules that have nothing to do with the excess baggage you have probably carried over with you from the offline, outbound marketing world.

As Seth Godin as so aptly stated, and I’ll paraphrase, a Meatball Sundae just won’t cut it!

Believe it or not, an incredible number of otherwise very savvy businessmen and women chase Number 3 and quickly go broke!

Or, if they are smart, lucky, and quick studies, they may wake up and avoid crashing into the rocks. You see, many go broke listening to the Siren’s Song.

You know what I am talking about?

Internet marketing gurus, gurus who are experts at doing just one thing, selling bright, shining objects to those otherwise savvy businesspeople who have lost all real business sense as they pursue the Online Gold Rush or believe they can create a Meatball Sundae!

The fact is, the Internet is different and inbound marketing is very different! In order to succeed, you must not only create a new marketing strategy, you must create a different business mindset, and then you have to  reset your thinking about how to pursue customers or clients, customers and/or clients who now hold all the cards and will seek out your product because it serves their wants, needs, and desires.

If you aren’t where they’re looking? You are out of luck and, very quickly, out of business online and offline.

So, reset your thinking this year and, if your marketing consultant is telling you that all it will take is a little whipped cream and topping for that Meatball Sundae…get a new inbound marketing consultant.

Yesterday!

John Zajaros
The Ultimate Internet Image
440-821-7018 (cell-anytime)