Chicago-based discount deal giant Groupon is expanding its service with an emphasis in hard goods and travel packages, and some local companies have seen fit to participate in the e-mail dealer’s new ventures.
With the September launch of Groupon Goods, Springfield-based fitness equipment manufacturer Stamina Products Inc. has moved more than 1,800 Pilates machines and indoor cycles through two featured deals, generating more than $450,000 in revenue for the company. “They called us on a Wednesday, and we ended up doing the deal on the following Wednesday,” said Brent Swanson, vice president of Stamina Products. “It was kind of a different type of thing than … you think of with Groupon. It wasn’t a local get-50-percent-off-your-hamburger kind of deal. They came in and wanted product.”
He said officials from Groupon, known for its Daily Deal e-mail product, approached Stamina Products after seeing its equipment online. Swanson said Stamina officials were receptive because they saw an opportunity to unload some obsolete inventory, and the company sold 1,100 Pilates machines for $249 apiece, 60 percent off the retail price, during the three-day deal ended Sept. 30.
“The consumer gets a good deal, and we were able to move through some product,” he said. Stamina’s indoor cycle began selling on Oct. 12 for $249, and it sold out of the more than 780 available by Oct. 14.
Groupon, which has become known for its daily e-mail deals on everything from haircuts to dinners-for-two, claims 35 million subscribers in 35 countries. It works like other similar daily deal Web sites in that discounts of 50 percent or more become possible with high volume sales. With all of its services, once a minimum quantity of purchases is met, the deal is in force. Groupon splits the deal revenues with the vendors, in most cases netting companies roughly 25 percent of the retail prices.
The Groupon Goods launch comes on the heels of its Groupon Getaways service, a partnership with Expedia in July to reach its millions of members with discounted travel packages.
Julie Mossler, a spokeswoman for Groupon, said it started its Groupon Goods service as a way to connect people with products from manufacturers nationwide. She said typical featured products include electronics, clothing and fitness equipment.
“Usually, you have a handful of days to purchase (deals), but they do sell out really quickly, so we encourage to buy them when you see them,” Mossler said. “The deals are available until they sell out, so it could be three days, it could be five, it just depends.”
She said Groupon researches the companies it chooses to work with and selects businesses that it believes can follow through on the promise of the deal.
As for Stamina, Mossler said the company was great to work with and it had received excellent reviews.
In most cases, Mossler said those buying products are driven to the featured company’s Web site, which can lead to more buying. “That’s actually a great opportunity for these merchants to showcase other things that may be complementary purchases,” Mossler said.
At least three area resorts are dabbling in the three-month old Groupon Getaways.
Still Waters Lakefront Resort on Table Rock Lake in July offered two nights for $129, or 55 percent off the published rate, and Lodge of the Four Seasons in Lake Ozark last week posted two nights for $139, a $278 value.
Grand Country Inn in Branson tested the Groupon waters with a traditional Daily Deal on Sept. 30.
Internet Marketing Director Jennifer Robinson said the company was so pleased with the more than 200 packages it sold in the Springfield area that day that it is participating in the Getaways program beginning Nov. 1. Instead of being limited to the local Groupon e-mail list, this deal is going international, reaching millions of Expedia and Groupon members across the globe, she said.
“We were running it in Springfield just to test it to see how it would go, and (the packages) sold better than Groupon thought they would,” she said of the deal offering four packages ranging from $20 to $149.
She said Groupon recommended a limit of 4,000 packages on the Getaway deal, but Robinson would be happy with less than half of that.
Similar to Groupon Goods, the deals on Getaways can last for multiple days, Robinson said, adding that the November deal is scheduled to last for a week.
Stamina’s Swanson said he felt working with Groupon was beneficial to both companies, but it wasn’t something the company would want to do all the time.
“One of the problems you can face with those kinds of retailers is you don’t necessarily want to be associated with closeouts and things like that,” he said. “Yeah, it probably helped our brand name and got us some recognition … but, heck, we’d rather do that in a positive way and make money on a really good deal ad with another type of retailer.
“We have a lot of product distribution and we don’t want to upset that distribution in the market.” [[In-content Ad]]
