Groupon + Gap = tipping point for coupon adoption in America

gap-groupon-deal

Groupon‘s nationwide rollout of $25 for $50 worth of Gap merchandise got a lot of mainstream media airplay and sold 441,000 Groupons, netting $11 million. The net effect is the mainstream buzz that introduces Groupon to America. The “daily deal” is becoming institutionalized as the advertising medium most compatible with the Great Recession.

Here is what the Groupon + Gap deal will spark:

  • More national deals. Think Office Depot, Best Buy, Home Depot, or Apple Stores where the sale of higher ticket items over $100 can justify a $25 for $50 deal. Groupon and other coupon players can layer on national deals on a limited basis so they don’t alienate their local business client base.
  • National and regional retail chains now have a medium for brand revival. Can a loss leader Groupon strategy create enough traffic to generate supplementary sales, or even stave off seasonal financial problems from the one time coupon receipts?
  • Shopping malls and local business associations can now systematically round robin “daily deals” among their stores in order to deliver foot traffic.
  • The spawning of national deals that don’t require redemption at the physical retail level. Think infomercial products, Dell PCs and other electronics, and odd lot inventory.

Groupon has shown they are more than just a local restaurant play, and it’s frankly more market efficient to produce one national Gap campaign to complement the hundreds/thousands of local campaigns they do daily as their bread and butter.

One fallout about the Gap campaign is the prospect that everybody will be wearing the same Gap clothes this fall!

About Pat Kitano

Patrick Kitano works with brands in developing hyperlocal engagement solutions and is administrator of the Breaking News Network, a national hyperlocal network devoted to community service. He is the author of The Local Network on Street Fight, and is reachable via Twitter @pkitano and email pkitano@gmail.com.

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