Why Brands Are the Key to GroupMe's New Business
On the surface, one might think this product is the newest competitor to Groupon or Living Social. Each service is based on the notion of group buying. With Groupon the idea is if X number of people purchase something, everyone saves money. With GroupMe, the idea is not that people will save money by buying during the same time window, but that they will be able to organize outings that are "the easiest way to do something awesome with your friends."
An example of a GroupMe Experience is the Long Island Bike Odyssey, in which friends can share a bike tour on the north shore of Long Island. The trip includes wine tasting, lunch and other amenities. The platform makes it simple to organize and pay for the experience, alleviating the usual hassles that individuals might encounter when trying to organize a group outing.
Upon learning about the details of this new platform, my inner strategic planner asked, "What is the opportunity for brands?" It became clear that there are two:
Branded VIP "experiences." Staying with the bike tour example, this could be a brand-sponsored trip in which cyclists get to ride with a celebrity.
Brand-underwritten "experiences." Here the brand would foot the costs, and in return gain access to the participants for opinions and other research. The company's goal would be to unearth consumer insights from highly targeted social groups.
While the first event could be a powerful branding tool, the second could generate fresh insights for marketers and prove to be a breakthrough in consumer research. Online focus groups have proven effective to some degree, but in this case a brand would be able to select an experience to subsidize based on location and type of activity. The group would be narrowly defined as, say, "people who like to bike and live in New York." It seems to be a fair exchange for participants, whose trip is paid for, and for the company, which would benefit from access to data it might not normally be able to generate.
Unlike the traditional focus group, this method of gathering insights would alleviate the potential bias of the "professional focus-group attendee" who shows up just to earn the small fee that a brand might be paying. And, since survey questions would be answered on an individual basis, the often distorting dynamics of a group interview in which people in the group try to impress each other, for example, would not be a factor.
Participants would respond digitally, but, in the setting of a group activity, they would feel less of the anonymity that often comes when people answer surveys secluded in their home. They are likely to be more comfortable giving answers.
As digital media buyers fixate on the sometimes valuable returns of data targeting, marketers with a wider world view must remember the importance of qualitative insights gleaned from the voices of real people.
GroupMe is not the only platform that can achieve this, but as consumers began to move to life at the intersection of the physical and digital worlds, new opportunities such as this will arise. The innovative strategist will promptly identify, test and learn from such opportunities.