Social Shopping & Coupons: It’s a Girl Thing

The fastest growing digital company in the world is Chicago-based Groupon, which this week announced 2010 revenues of $760 million, up from $33 million in 2009. Even bad Superbowl ads can’t undo that kind of head-turning performance.

Rocket-like growth inevitably brings intensified competition. Right on cue, the category of ‘social coupons’, which also includes Living Social and Gilt, among others now also includes a new, niche entry, Think of it as Groupon for fashionistas – “YouCeleb gives you access to the hottest celebrity fashion without the celebrity bank account” In a nice twist, a portion of the proceeds go to the celebrity’s favorite charity.

The female focus of is not an accident.  A cool infographic from Digital Buzz highlights the profile of Groupon users – young, wealthy, educated women.

  • 77% female
  • 66% 18-34 years
  • 50% have bachelor’s degree
  • 30% have post college degree
  • 70% have above average incomes ($50K or more)

Given this profile, it’s not a surprise that many of the most successful Groupon offers are for things young women enjoy – salons and day spa’s, dining out, and yoga classes.  And they do LOVE them. Here are some comments by members of our Millennial Marketing “super consumer” community:

Sasha Muradali:I get really good deals on these and I’ve seen really good deals on them too. There was an 85% MMA discount about a week ago on The Dealist I think. I bought one on them recently for a 6-week foreign language class. The thing is, places I wouldn’t normally go to, or things I wouldn’t normally participate in, I get the opp too through Living Social/TheDealist/Groupon. Besides for the discounts, it just opens your eyes to new and cool things. Discounts are always good — really good discounts are even better! :-)”

Katie Lorenz: “I use Groupon, Living Social, Foxling, and Deal a Day Online.  I cancelled my gym membership and only use Groupons for yoga, ballet classes, pilates and tennis (usually unlimited use for a month) and 90% of the time they’re places I’ve never been.  I’ve loved all the facilities but their normal prices are usually too expensive for me to continue on so I find the next best thing. “

The men in our community are more equivocal in their assessments of social coupons:

Justin DeGraaf: “I subscribe to Groupon and just started livingsocial during the GC bonanza. Although I look at Groupon maybe 3x a week, I’ve never purchased anything. For some reason, I don’t feel like it’s a good deal, most notably on services. I don’t trust that the rates a spa, for example, gives are any cheaper than if you were to call them and ask for an introductory special. And in my town, the restaurants that are participating are the dodgy and struggling ones. Now, when Living Social did the amazon special I went crazy! Bought like 6 of ’em. : )

Steven Conway: “For me, it depends entirely on the category of the deal.  When it comes to apparel/retail brands, I tend to purchase groupon deals from brands I currently shop at it like the Gap and Nordstram Rack, as there is a perceived higher risk in buying a groupon from a retailer I do not shop at or like – no matter how good the deal is.  On the other hand, when it comes to a restaurant, I will take a chance on a place I haven’t tried as I feel there is less risk involved. Overall, I would rather have a bad meal experience than buy something from a clothing retailer I probably wouldn’t wear.”

Consider the Target

Marketers considering social coupons as a strategy for gaining trial should first consider the characteristics of their target. Is the target young, upscale and female? Then social coupons may be just the ticket.

Social coupons fits with the overall social context of shopping for young women. E-marketer provides an excellent overview of how teen girls approach shopping (“Online Shopping Is Entertainment to Teen Girls“). Millennial age young women are similar to teen girls in that they love shopping, but they like shopping with others even more. For them, shopping is more than deals, it is a way to bond. Talking about your Groupons and sharing deals generates important social currency, currency that is often less meaningful for guys. may be the first of a wave of female-focused social coupon opportunities.  It’s harder to imagine new Groupon-like sites just for guys — Trouton, anyone?

A special thanks to Suhan Park, Notre Dame MBA candidate, for alerting me to the launch.