Groupons Problem: It is Not a Platform

At HBR.com, Rob Wheeler wrote a post entitled Groupon Doomed by Too Much of a Good Thing. Rob discusses why he believes that "Groupon's fundamental problem is that it has not yet discovered a viable business model."

I would disagree as I think Groupon does have a business model, it is just flawed and will never work. What do Facebook, Twitter, Constant Contact, Apple, Google, and LinkedIn all have in common? These firms all have built a platform. These are not single solution apps, like Groupon, but rather large scale platforms that can be used by these firms to add features and functions as well as tap into a community of users to help build out exciting new applications. What exactly can Groupon do to build out its application? Is it a platform? Can people leverage it in many different ways? No. It is what it is - an email application for the most part.

Think of Apples app store and all of the apps that people have built to make the iPad and iPod that much more useful and vital to people's everyday life. Can Groupon do something similar? No.

They key here is if you want to succeed and be relevant in today's web world, you need to build a platform, not a point solution.

 

Ollie Ollie In Come Free

Image via Wikipedia

As my kids get older, I am amazed that they use the  same expressions in their games and daily play that I did when I was their age. I did not tell them any of these but they have picked them up on their own, somewhere. It made me think about how powerful it would be if you could create your own slogan or brand reputation that is passed from user to user or even generation to generation. There are certainly examples:

• Have a Coke and a Smile
• Good to the last drop
• Snap, crackle and pop!
• I'm a Toys R Us kid
• A diamond is forever
• Got Milk?

And then there are famous characters from Ronald McDonald, the Donut Man, Burger lady, Marlboro man, Flo, and the Geico Gecko as well as  iconic firms like Coke, IBM, Apple, and others that have enjoyed a long held brand respect in the market they serve.

I am wondering with the noise of all the social media platforms if it will be easier or harder to have a long lasting  impact in the marketplace like the ones referenced above. The item that was "it" yesterday can be torn down and replaced extremely easily now and that has huge implications on developing brand equity. Given the power that has been transferred from marketing departments and media agency's to the end user we may see the consumer become the generator of the next great brand or slogan. The hard part will be giving up the control over the message, but that is already happening so the sooner you can embrace it the better off you will be.

Ollie Ollie in come free - who will be next?