Groupon Opens Store in Singapore
Groupon in early July officially opened its first retail concept internationally in Singapore. In a press release, the daily deal website’s Singapore division said the store "was created for Groupon consumers to better experience the Groupon lifestyle through a tangible interactive environment."
Said Groupon Singapore’s chief operating officer Adrian Tan in a statement, "Although many Singaporeans today like to easily go online to purchase deals, many still prefer the face-to-face interaction and the fact that an online shop like Groupon has a physical presence."
The 4,400 square feet store promises to have more than 50 service personnel to make it easier for customer to redeem and collect their Groupon Goods purchased on the Groupon website and address any customer service issues. The concept partly came about because a smaller redemption center in the area continually faced long lines, Mr. Chong told CNET ASIA. Groupon Singapore’s customer service team is located in an area in back of the store.
But the shop also features iPads as well as three computer terminals for shoppers to browse, purchase, print and redeem their Groupons on the spot.
"Our customers prefer to pick up their Groupon Goods instantly and in a more convenient location," said Mr. Chong in a statement. "The new Groupon Shop, located at Suntec City, provides this advantage, and as a bonus, our top-selected goods will be on physical display for immediate purchase, just as you would expect in a traditional shop."
Finally, the shop works as a branding tool with its "resplendent colors and a large ‘G’ logo marking its location." The store’s iPads are covered with the company’s signature green color. The first 50 customers who visited the Groupon Shop dressed in green on the official opening date, July 4, were given $50 worth of credits.
Groupon Singapore said the store has "already seen promising initial results, and if successful, may also be rolled out by Groupon to other markets."
Discussion Questions
Discussion Questions: Will Groupon and other daily deal sites benefit from opening physical locations such as the one in Singapore? What do you see as the biggest benefit of having a physical presence for daily deal sites?
Groupon is following LivingSocial in establishing physical locations to interact with the business. If both companies can continuously offer unique products and experiences, consumers will visit their stores, and those stores will enhance their online brands.
Having physical locations for daily deal sites doesn’t seem to make much sense. The very nature of this business model capitalizes on the ability to leverage the Internet and mobile applications.
What is the value proposition for shoppers here? How is it more convenient? At best, Groupon may get some benefit from partnering with retailers and leveraging physical presence. Best Buy maybe?
My first reaction was “How sad.” Have our lives become so empty that we go to a coupon store for “a tangible interactive environment?” And exactly who or what is the “interaction” with? It looks like people interact with a computer screen and a printer — the same empty interaction they get at home. Oh, I forgot…they also “interact” with one of 50 staffers who help them get their coupon as quickly as possible and solve their redemption problems. Nothing warms the heart more than some of that old fashioned “tangible interaction!”
My second reaction is “I hope this stays in Singapore.”
Confessedly, I know a just a little bit about Singapore and perhaps even less about Groupon’s daily deal site there, or why it picked Singapore, but my intuitive sense whispered to me that this is an experiment with expandable potential.
Anything that more closely involves a physical presence for the potential buyer would seem to further stimulate a product sale. That makes the “G” logo loom larger.
Is this commerce, convenience, experimentation, or branding? Commerce or convenience is quaint, but won’t scale globally. Experimentation (testing services) or branding (flagship store) might work as an R&D or marketing project.
Further, Singapore presents two anomalies: location and product mix.
1. The location may work there, but not elsewhere. Singapore is a concentrated urban locale. Groupon is co-locating its Singapore support staff in the facility, so it doubles as a call center and replaces their existing redemption center.
2. The product mix might work in Singapore but not elsewhere. Singapore strategy emphasizes Groupon Goods. Yet Groupon launched Goods in Sept 2011 and it’s only a slice of the business. Finally, retail stores burden Groupon with staffing costs and stock logistics. Yet Groupon’s key categories are spas, salons, events, activities, restaurants, and the like.
Creating physical infrastructure for an online daily deals is a dubious proposition. Already bearing the high costs of sales staff and marketing, Groupon is unlikely to invest in buildings. LivingSocial’s offline foray is closer to the mark. Instead of goods, it provides services. It renovated its DC Penn Quarter building, developed an experimental studio, and allows merchants from chefs to yoga instructors to run events and classes.
Interesting. How is this different from retailers that allow Internet purchases to be picked up in a 4-wall store?
Establishing a physical presence in any market may insure against wasteful spending through speculation. Placing local employees with customer service experience in the new location will open valuable channels of communication for positive future growth potential. Well done Groupon!
I could see a few stores for branding purposes in major markets like New York and Chicago, but it would make no sense to roll out Groupon retail stores. A kiosk in major malls would make more sense.
Interesting contrast between Groupon’s physical pilot and LivingSocial’s. LivingSocial’s being about unique experiences and interacting with other customers, whereas Groupon’s seems to be more about instant gratification and physical goods. I give LivingSocial’s concept a better chance of catching on at scale.
“[T]he Groupon lifestyle”??? Please. No.