Social Commerce

Play-off Time for Group-Buy: Google Offers $10 Starbucks Voucher for $5 [Screenshots]

If you want to succeed in social commerce either as a vendor or service provider, you’ll need a competitive ‘positioning’ – a ‘reason to choose’ over Amazon, Google and Facebook…

Take the group-buy space.  Although a pale imitation of the powerful Eastern ‘Tuangou‘ (‘team-buying’ ) origins, the Big Three are showing how deep pockets, scale and innovation can out-muscle Groupon-esque incumbants.

Hot on the heels of last month’s AmazonLocal’s $10 Amazon voucher for $5 deal to boost subscribers (1 million+ sold),  Google Offers is playing the same game.  Head over to Google Offers and you can get $10 Starbucks voucher for $5 (for the next six hours, and you get to polish your halo – for every offer purchased Google donates $3 to the Opportunity Finance Network (OFN) for the Create Jobs for USA Fund (up to $3 million)). It’s a premium on the $5 customer acquisition cost in the social commerce space, but Google has deep pockets.  No word yet on take-up, but the Starbucks website is struggling to keep up with redemption demand…

So what, you say?  More Groupon clone action.  That’s yesterday’s news. But like last night’s NBA matchup between Miami Heat’s Big Three and Oklahoma, the Big Three – Amazon, Google and Facebook – are flexing their muscles, and showing they mean business.

  • Google Offers: Powered by Google Checkout, and integrating Google Wallet – the prepaid offers site launched on May 26, 2011. Also aggregates offers from other sites (Gilt City, Plum District, ATT Interactive…). Experimenting with frictionless Loyalty Rewards mechanism – pay with the same payment card on multiple occasions to receive a credit to your credit card bill. Complemented with new Offer Ads (click on ad to get redemption code)
  • AmazonLocal: Launched Jun 2011, and already the #3 player in the online prepaid offers space ($6m monthly revenue @ Oct 2011).  Trusted in the e-commerce space, Amazon has 144 million Amazon credit card numbers on file to monetize with their local online marketplace. Ad-subsidised Kindle owners get deals pumped through to the front page of their Kindles
  • Facebook Offers: Launched Feb 2012, Facebook Offers is more like Google’s Offer Ads – no prepayment, simply a discount voucher to redeem in-store or online.  Offers appear in the newsfeed, timeline and Facebook ad bar, with a ‘frictionless’ one-click claim.  Free for Facebook page owners to create.

With the Big Three muscling in on the group-buy segment, it’s not a pretty time to be Groupon or LivingSocial, or any other social commerce player for that matter.  Whilst all very different – all three are bringing Simplicity to the social commerce space, with easy to use (for vendors and shoppers services).  This is smart.  Simplicity, Instant Gratification and Reassurance are the three critical factors for the take-off of a successful idea.

The lack of social features notwithstanding, social commerce vendors and service providers should take note. Specialisation will be the name of the game – social commerce success will mean crafting your value proposition to a specific market niche. You’re not going to out-LeBron LeBron.


Chartered psychologist specialising in consumer behaviour, wellbeing and technology. Certified CX professional experienced in Design Thinking. A researcher, writer and speaker, Paul is head of Digital Insight at SYZYGY.

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