Can Retailers Get Their Holiday Groupon?

Group-buying sites are all the rage in 2010. Groupon’s meteoric rise has brought on billion-dollar-suitors and their model has been reproduced through countless clones. With the holiday shopping season now in full swing, major retailers should take notice of this new medium as they fight to get their piece of the pie.

Looking at the Compete Online Shopper Intelligence™ study, fielded Oct 29 – Nov 16, we see that almost half of all consumers interviewed visit group-buying sites at least “Sometimes” and that 1 in 5 visit frequently. A significant portion of consumers will be looking at group-buying sites to be a part of their holiday shopping this season.

Would a national retailer benefit by teaming up with a group-buying site, such as Groupon, during the holiday season?

The best insight we have to answer this question can be found by looking at the Gap’s Groupon offer from this past August. This was Groupon’s first national deal and was seen as a huge success for both parties. Although the voucher was only valid for in-store purchases, we at Compete specialize in observing online behavior to gain insights into the offline marketplace.

Over one third of Groupon visitors who purchased the Gap voucher visited from August 19-31 (the deal was offered on August 19th). Even 15% of those who viewed, but did not take advantage of the offer reached the Gap’s website in August after the offer went live. In that same span of time, only 0.4% of all online consumers visited In the months since going live, visitation to the Gap’s site has not tailed off by those who viewed or purchased the voucher.

The offer was only good for in-store purchases, but voucher buyers looked to research online. After buying the voucher, ‘Store Locator’ usage instantly jumped up by those with a cool $50 to spend at the Gap. The deal even seemed to pique the interest of those who only viewed the offer – who, despite not having a credit to use, were still interested in finding the nearest Gap location.

Following the success of the Gap voucher, Groupon has gone on to offer another nation-wide deal for American Apparel and looks to offer more in the future. In an effort to foster holiday shopping, they began offering certain deals for more than one day as well as selling products directly to consumers through the newly launched Grouponicus. Groupon has a nation-wide reach and will be on the mind of many holiday shoppers. The only thing that’s missing is for a major retailer to come in and capitalize with the right deal during the highly competitive holiday season.