Deal of the day website Groupon is the fastest growing companies in web history and a popular way for local businesses to generate some buzz in their areas, but some independent photographers are finding out the hard way that offering special deals through Groupon might be the worst marketing decision they ever made.
Here’s how Groupon works: local businesses offer a special deal through the site (typically at least 50% off), and people buy the deals directly through Groupon, which takes a 50% cut of the proceeds. Businesses that offer deals may actually lose money from the promotion, but the hope is that the hundreds or thousands of people who take up the offer may become repeat customers and help spread the word about the business.
This type of marketing may work for businesses like restaurants, which can fill up empty tables and generate some buzz about their food, but for independent photographers it might actually be a horrible idea. Case in point: photographer Tim Jones offered a £200 photo package that included a 1-hour on location shoot for £29.
Here’s what he included in the package:
- 1 hour photo shoot in either the comfort of your own home or another location
- Every photo taken will be put on CD or DVD in high resolution
- 20 of the images will be professionally edited and air brushed
- Also includes one 12×10 framed print, two 10×8 prints, two 8×6 prints, two 5×4 prints, two 4×3 prints, and two 3×2 prints
- Suitable for marking a special event or occasion
- Up to three outfit and one background change
Newspaper photographer Andrew Smith crunched some numbers, and came to the conclusion that Jones is actually losing money for each of the 301 people who purchased his package.
Even if this photographer is doing each job to a bare minimum standard, he has committed himself to nearly a year’s work for no money. If that doesn’t sound like good business sense to you then be very careful if you decide to offer a deal through Groupon or any similar site. What may at first seem like success could very easily put you out of business.
Even if Jones does manage to plow through the hundreds of shoots he booked for himself, he still has the difficult challenge of making this promotion benefit his business in the long run. If using Groupon to promote your photography business has crossed your mind in the past, let this be a lesson to you: be careful not to bite off more than you can