Lucky vendors have impressed their peers with stories of amazing group buys. Hosting group buys with third parties helped boost sales, attract new customers, or get rid of a bunch of old stock.
Unfortunately the majority of vendors have not been so lucky. Do you know the vendor’s most common complaint about group buys?
We’re just not seeing return on investment.
Well, we believe in skill more than luck. Follow these tips for hosting group buys with third parties when you’re organizing your next pool purchase to increase your odds of success. Leave luck to the dabblers!
(1) Plan All The Way To The End
Did you know that an alarming 87% of vendors didn’t attempt thorough strategic planning before hosting a group buy with a third party? Where on earth did common business sense go?
Despite its appeal, group buying is one of those activities where you don’t just hop on the bandwagon. There are too many variables at stake. Customer acquisition costs, customer retention rate, and brand image are just some of the items you must see in black and white before making a single move.
(2) Bargain Like A Senior Negotiator
Here’s a blunt truth: you don’t need to pay those high commissions when you’re hosting group buys with third parties or middlemen. Don’t be afraid to haggle and get that commission to as low a point as is truly comfortable for you.
The main reason vendors complain about negative ROI is because they failed to calculate customer acquisition costs.
You’ve got options and trump cards to play. A daily deal site or middleman depends on your business. So keep a poker face and stare them down. They’ll fold.
(3) Leverage Social Media
Forbes published a solid fact you need to prepare yourself. 78% of vendors using social media outsell their peers.
In fact, if you consider it critically, social media clout is one of the main advantages daily deal sites are leveraging. That commission you’re paying for is because of a company’s power to reach consumers. But who is better placed to reach out to your own customers than you?
Rip out a page from the daily deal sites’ social media strategy. Start building a social media rep for yourself. This will help at the bargaining table when you’re hosting group buys with third parties.
(4) Stay In Control
This point is actually related to planning all the way to the end. Consider it an elaborated emphasis. There are three principles to adhere to when you’re hosting group buys with third parties.
i) Time: Time is of the utmost importance in a group buy. Time builds pressure and encourages customers to join the pool.There is no smart goal without a time-frame.
ii) Target: Successful group buys have overwhelmingly been those that are clear on targets. Stipulate to your customers exactly what is needed to access the discount. Like time, this can help build momentum and referrals.
iii) Limit: Don’t be a nickel wise and a dollar foolish. Don’t bite off more than you can chew. Does this sound like your wise uncle speaking? With group buys, you want to make it a habit to aim for the ribbon but stop at the finish line. When hosting group buys with third parties, learn not to allow them to sell you in too deep.
Hosting Group Buys with Third Parties the Skillful Way
If at first you don’t succeed, try, try again. If you do see the potential of group buys but you’re not entirely sure how to steer yourself through, we recommend the following:
- Download the Vendors’ Group Buying Tipsheet Vol. 1
- Learn how to host an independent group buy
- Schedule a free consultation with group buying experts at LetsPool!