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"I want the family farm - the backbone of our country's heritage - to thrive and survive for future generations."

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Groupons and Coupons, Consumers Want A Deal

By Jane Eckert

As part of my fall survey in 2011, I discovered a very interesting trend in marketing strategies and wanted to know more it.  Over 16% of my survey respondees said that they used Groupon (www.groupon.com) or another coupon provider last year to announce special offers to people in their area. I contacted these farms by email and asked for more specifics related to these offers and I think what I learned is important enough to share.

But let’s back up a second. If you are not familiar with Groupon, it’s a website where you register your email address and receive daily emails to your inbox announcing a special offer of the day specific to your area.  If you are not interested, you just delete the email, and if you are interested, you can make an online purchase and buy the “deal of the day.”

Many of the offers made last year by farms include: Buy one Get One Free Corn Maze Admission, Buy Two get Two Free Admissions, Pay 50% for Children’s Day Camp, or an offer like, Pay $15 for $30 of food at our tearoom.  In other words, the farm developed the offer to suit themselves. If you are a fall season farm, and you are already as busy as you want to be the last two weeks of October, then you can state in the offer that the coupon is good only Oct 1 -15.  If Mondays and Tuesday are a particularly slow day in the restaurant, then limit redemption of the coupon for only those days.  You write your own terms, within your agreement with the folks at Groupon.

The other important part of the offer is that you can set an expiration date of the coupon.  You don’t want a Groupon coming in three years after it is issued. The point of using Groupon or any coupon is to establish a sense urgency in getting it redeemed. Once again, you are in control and you can set the expiration date.

You should know that Groupon will collect the funds, and then they normally pay the business fifty percent of what they collect.  So if you’ve offered a 50% off coupon, you’ll see only 25% of the original cost-your half of what is collected. The payment seems to come fairly quickly after the offer day.  However, some of the farms told me that this rate is negotiable and, particularly if you have already had one successful offer you can typically negotiate a little when the Groupon sales representative calls.  Several farms were able to get sixty percent of the stated coupon amount.

One farm sold over 1,200 admission coupons to the corn maze and realized perhaps that was just offering too much of a good thing. Next year, they plan to limit the number of coupons that can be sold to the first 500 buyers.  Setting a sales limit is once again under your control.

When it comes time for redemption, the customer brings their printed coupon and it’s accepted the same as cash.  Groupon even allows the customer to download the coupon to a smartphone, thereby eliminating the need to print anything.  The customer just shows their phone to the folks at the ticket counter, who verify it is a valid coupon.

You are probably wondering how many people actually redeem these coupons?  Based on my survey, that number can vary substantially and redemption was anywhere from 40% to almost 100%.  Remember: you get paid when the coupons are purchased so any unredeemed coupons just means the money is still in your pocket.

Among the farms that responded to me, there was only one that said they would not do it again. The rest of the farms all agreed that this had been a good strategy to bring new people to the farm, or to fill a vacant restaurant seat or a slot in the summer camp.  All the farms said they learned something and will fine tune their offer, include an expiration date and limit the sales to a specific number.

Groupon is not the only company out there providing this service.  Another large supplier is called Living Social, and there are more national and local radio stations and media companies jumping on the bandwagon of the Groupon and Living Social format.

If you are contacted this year by one of these sales representatives, I would suggest you listen carefully, or you can go online and learn more about them before they contact you. Just remember the hints that I have given here to improve your offer.  We are all looking for ways to improve our marketing without spending upfront dollars.  Groupon and these companies receive a sizable commission for their services, but they are free to you, and may justify the discount in new customers or increased volume.

Jane Eckert is the founder of Eckert AgriMarketing (www.eckertagrimarketing.com), a full-service marketing and public relations firm that helps farmers to sell directly to consumers, diversify operations and become tourist destinations. She is also CEO of www.RuralBounty.com, a search directory for agritourism farms and ranches in North America. Jane can be reached at 314-862-6288 or you may email her directly.