Groupon in Montreal..not doing that well?

Groupon typically dominates every city it’s in. Why?

1. Certainly their name recognition
2. The media writes and promotes them more than any other Daily Deal service
3. They buy a ridiculous amount of search engine ads…..a ridiculous amount
4. They know what they are doing in terms of Deal flow, types of deals that work, promotional campaigns, etc.

For the most part Groupon has done a fairly good job in Canada. With one exception. Based on what we see, their numbers in Montreal are simply not good. It seems that they are having a hard time connecting with consumers who want to buy deals from their Montreal service. What are the reasons for this, why is Groupon one of the least successful sites out of Montreal when they are one of the leaders in almost all other major markets in North America?

There can be many reasons for this. Although the following may come into play:

1. Montreal is not easy. Most major brands that have been successful outside the province of Quebec and then finally decide to enter Montreal typically falter. They make basic strategic mistakes when entering Montreal. They underestimate the local consumer’s need for connection with a brand. Only the exceptional brands don’t falter. The city of Montreal is certainly one of the most dynamic consumer markets in North America. With a population around 3.5 million, it has 3 distinct consumer markets all in one city. The French market; it’s largest, the English market and the bilingual market.

Reaching one of these markets does NOT mean you are reaching all three, or even two for that matter. To us, it seems that Groupon has not connected with the French market in Montreal at all. Where other competing Daily Deal sites are doing very well in Montreal, Groupon is not selling many deals in the city….atleast not as many as they are used to in other cities. We do not see Groupon mentioned much at all in the French media or French blogs. They have also not established any partnerships locally. (they have not established any partnerships in most other large cities either….but this is Montreal, and in Montreal, Quebec you need to establish local presence of some kind and not just live in the internet “cloud”. ) We cannot stress this enough. For Groupon to be ultra successful in Montreal or throughout the Province of Quebec, they need to plug in to the local French community in a big way…in a sincere way.

2. Groupon’s url situation is confusing and undermines their marketing efforts.
Go to Groupon.com and you can visit any of their cities in North America, including all of them in Canada. Yup, except Montreal. In order to see deals from Montreal you must be forwarded to Groupon.ca url. Now, we understand why Groupon did this. It’s because of the dual language of the website for the Montreal site. It is in both French and English.

Groupon is now spending plenty of money on search ads trying to drive traffic to Groupon.ca only for Montreal. This site is run separately from their .com site and therefore does not get the benefits of search engine rankings or placements compared to it’s .com cousin. If you go to Groupon.ca you only see Montreal. You do not see other Canadian Groupon cities. This seems counter productive to us. We highly recommend that they add ALL Canadian cities to the Groupon.ca site, this will increase that sites traffic and thus search rankings, cross city shopping, etc. But only the deals from Montreal or eventually Quebec City would be shown in both French and English.

3. The deals don’t seem that great.
We feel that some of the deals coming out of Groupon Montreal are not that attractive. Their competitors have more deals, at more interesting merchants and locations. Perhaps the sales reps they hired for Montreal are not that aggressive or are not as good as those in other cities. Recommendation: Montreal is NOT like other cities. Canada is not the USA. Groupon should hire a Country Manager, or Country Sales Director. IF they do, they should make damn sure that this person knows the Quebec market. One of the typical mistakes brands make when entering Canada or Montreal is they hire their management only out of Toronto. Why? because that’s an easy decision to make. Easy yes, but not the most effective. If management does not know the Quebec market, you are saying goodbye to the 2nd largest consumer market in Canada. It is far easier to compete and gain awareness in the Toronto market than it is in the Montreal market. In Montreal, you have to know the market, know the retailers, know their nuances, speak their language.

Summary, in Montreal, Groupon is not cool…yet.  Something they have already accomplished in most other cities. This is typical of most brands trying to establish themselves in the city. With some focused and consistent effort at connecting with the local community, Groupon will establish itself as a major player here. For now, Groupon is around the 5th to 7th popular daily deal site in Montreal. Those numbers should be unacceptable to Groupon execs. So far, their competitors are eating their lunch.

2 Comments