Case Study: Using Mobile Tools to Track Coupon Redemptions
Oklahoma Premier Carriage Company owner Clint Parker has run daily deal offers with all the major players – from Groupon and LivingSocial, to smaller companies like Wimgo Deals. He says that new mobile scanning apps are making it possible for his employees to track voucher redemptions while working in the field, which has led to fewer instances of fraud and bigger tips from satisfied customers.
How did your most recent Groupon come about?
We have actually run three Groupons. The first one was a little over a year ago, and they called me out of the blue and wanted to know if we would be interested. Initially, I was not. I was like, there’s no way that we want to do something that’s $30 [worth of product] for $5. About a week later, the guy called me back and said, “Just hear me out and let me tell you the benefits to your business.” So I listened to him, and the benefits seemed reasonable. We did the first one, and we sold around 450 [coupons]. Right after that, LivingSocial called us. What they do is they just watch who does a Groupon and then call those businesses, which is smart. With LivingSocial, we sold under 100, but they were new. We ran the first week that they offered in Oklahoma City. After that, we did a deal with Wimgo and we sold around 120 or 130.
Did you notice any major differences between the three companies?
Initially with Groupon their split was 50/50. I just didn’t know any better. With LivingSocial, right out of the gate their split was 60/40 — 60 percent to us and 40 percent to them. Wimgo was 55/45, but I actually got them to go 60/40. So, the market is 60/40. With the last two Groupons that we’ve done, we’ve raised the selling price and I’ve required a 60/40 split. One of Wimgo’s selling points is that 5 percent of their percentage goes to a charity of our choice. So that’s kind of cool. They also market that they are a local company, so the money stays local. Our goal is to market to the greatest number of people, so Groupon has worked the best for us.
I saw that you sold more than 800 Groupon vouchers during your latest run. Is it hard to handle that many new customers at once?
No, it’s not hard because we are the largest company in the area and we have a fair number of carriages out every weekend. If there’s a wait, there’s just a wait. We do put on [the coupon] that reservations are required. We put that on there because we don’t want to have [a night] where it’s only Groupons. That means we’re not getting any cash. But that has never happened. We are always mixed with Groupons and cash paying customers.
Have you been able to retain the majority of new customers that come in?
It’s hard for us to know how many [customers] have actually come back and ridden unless they tell us. Initially, over a year ago, when we did the first Groupon we had to manage the coupons daily. We were able to download a list of the people onto a spreadsheet. Then, when they brought the certificates back, I went in and color-coded that certificate. It was very much a manual process. We actually ran into some instances where people made copies of their Groupons, but there was no way for the drivers to know that until I compared it to our spreadsheet. Well, now Groupon has come out with an app for Groupon merchants on the iPhone. We just scan the code with our phone and it automatically redeems it and makes that coupon invalid. There were actually two people that bought Groupons who got three rides each before they came out with this app, because I didn’t take [the spreadsheet] out every week and give the drivers an updated list. We don’t want to be the company that flips through pages and make sure that your coupon is valid.
Have there been any other changes that have made it easier for merchants to manage their daily deal offers?
When we did the first Groupon, the salesman had a “platinum” [program]. That is where we agree not to sell any other company’s daily deals for a year. It’s an exclusive deal. When [the salesman] asked me if I’d do that, I told him, “Look, the deal goes both ways. For me not to do another daily deal, you can’t approach one of my competitors.” He said, “Well, I can’t do that,” and I said, “Then neither can I.” Now they’ve added an incentive, so we get our money faster if we do that. We also had a new salesman for this last sale, and he agreed not to approach any of our competitors. So, we have gotten a verbal agreement from him.
How do daily deals compare to other forms of advertising you’ve done in the past?
It’s hard for me to say that this is the best marketing tool because we don’t do other marketing, but I would do Groupon in a minute. We get our name out there and we’re pretty much guaranteed business every weekend. There are four other [carriage] companies in Oklahoma City, and there are nights when it’s a slow night and we will stay busy while the other companies just sit there. So, it provides a means for us to stay busy and it keeps the customers willing to give really good tips. Our drivers love Groupon because [they] get all of their tips. Typically what people will do is they’ve already paid – $15 for the Groupon in our case – so they will just tip the other $15 that they would have paid for the ride. So it’s a really good deal for the drivers.