I know, I know. I just asked yesterday whether anyone gave a rip about the deals space. Surprisingly more people than I thought actually did which is good to know.
Today this article from the Wall Street Journal caught my eye not just because of the deals aspect but more from a pure business marketing aspect. Amazon is a monster in the same way that Google is. It has a ton of weight to throw around and it doesn’t mind doing so. It offers local deals in a few markets (Boise, LA and others) just like Groupon does. Amazon invested in Groupon’s biggest competitor. So what better way to pee in Groupon’s corn flakes than to go after their home market of Chicago?
Amazon.com is quietly launching its own deal-of-day discount offers in Chicago, a launch reported earlier by the Chicago Tribune. The Windy City, of course, is the corporate home of Groupon. Pause to let the symbolism sink in.
“Customers already know and trust Amazon.com for their online purchases, and now with Amazon Local, they can also find great deals right in their own city,” the company said in a statement. “AmazonLocal is a great way for residents of the Windy City to enjoy the restaurants, spas, and activities in their backyard.”
So what makes this move a brilliant marketing move? Well, Groupon is in their pre-IPO quiet period so they need to keep their statements to the public to a minimum (as in none) especially with all the questions about their accounting practices that seem to forget how much money they are hemorrhaging each day.
Amazon, meanwhile, is still in their “let’s be friends” investment stage with Groupon’s rival LivingSocial so they have access to this hungry sales force. That is for now at least because Amazon has been hiring their own sales folks for when they go the whole deals route solo by the end of the year which would mean they are competing with everyone, including their own investment in LivingSocial.
Talk about striking at the right time! This is some marketing brilliance here! Your competition is in their quiet period and have had many public screw-ups, you have a ready willing, able and hungry sales force that can swarm the marketplace AND you are Amazon. Nice work.
I don’t wish for anyone to ever take a tumble but it can be hard to root for Groupon sometimes. Now we’ll see what they are made of as their home base gets invaded by a bigger more well known and profitable competitor who seems eager to clean their clock. This could be fun.
As Billy Crystal said in the Princess Bride (but I am not sure a miracle is needed here)