Ponpare (Groupon style service in Japan) inflinged the most important rule of the business model. Ponpare has offered $1 coupon for two Häagen Dazs (usually $7), if more than 0.5 million user buy it. But 5 days later, only 0.13 million user have clicked it. In response to the lower (than expected) demand, Ponpare changed the rule and turn on the deal.
Most of the Ponpare user are pleased with it. But... I feel the company has entered off limits area. This action distorts the mechanism of the business, and weakens the incentive to Retweet a coupon in the future. This incident not only affect Ponpare but also affect other Groupon style service.
In Tokyo lots of Ponpare user tweet "Good Job!", though a game theorist in San Diego believe "Worst Job!"
I agree. Their business model can quickly unravel if people know/expect them to lower the threshold every time it is not met.
ReplyDeleteWow, that's actually a really interesting question. My first instinct is to agree that it's a bad idea. But then I think about how I use Groupon: I never pay any attention to the threshold. I just assume the deal will be on. I feel like my individual "vote" makes no difference. It would be interesting to know how many users feel like me and how many feel the opposite.
ReplyDeleteYes, I agree that, when people get used to using Groupon, most of them do not care so much about the threshold. What's happening in Japan is exactly this phenomenon, so you are in majority! if you are in Japan. Given this fact, however, I doubt if this business model can continue to success. I believe that existence of the threshold was the key driving forces at the early stage of the business. Once the meaning of the threshold has been lost, what will happen?
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