Still not liking Groupon’s business model a whole lot…
In a post over at the HBR site, I note that Groupon's business model continues to be problematic. In response, I received some updated news from Sander Daniels, who runs a site called Thumbtack that acts as kind of a clearinghouse for daily deals. Here's what they found:
We reviewed 10 daily deals offered by Groupon and Livingsocial, and the "regular" prices quoted by Groupon and Livingsocial were higher in 8 of the 10 cases than the prices quoted by the same merchants when we called them.
This seems like deceptive marketing to consumers, no matter whether it's the small businesses, the daily deal sites, or some combination of the two that is causing this price inflation.
To read the full report, follow this link:
http://www.thumbtack.com/blog/case-study-are-daily-deal-discounts-inflated/
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- Posted Rita McGrath on October 13, 2011
Smart ideas about pricing from Trish Gorman
My good friend and colleague, and Dean of the Jack Welch Management Institute, Trish Clifford, had a very thought provoking post over at her Forbes blog on where Netflix went wrong in its latest strategy kerfuffle, particularly with respect to pricing.
She makes the point that one can either price cost-plus, price to market or price to value. One of the biggest challenges I see with growth businesses, in particular, is figuring out what that value really is and pricing accordingly. As Trish points out, Netflix committed some cardinal sins in this regard, particularly surprising its customers with a steep price increase and confusing them with an on again off again strategy to abandon DVD's by mail and switch to streaming. Worth a read!
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- Posted Rita McGrath on October 13, 2011
Early warnings of a bubble in housing from 2004
It's amazing, isn't it, how often we ignore sensible advice when it seems unfashionable or less than desirable? I was thinking of that when I ran across an article published in Money Magazine in 2004.
Among the author's observations:
- Owners have unrealistic expectations
- Housing is increasingly unaffordable (too many millionaire mansions)
- Signs of a slowdown are emerging in many areas
- Housing debt is getting worse
They conclude with the cautionary note: If something can't go on forever, it won't. Had we but listened!
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- Posted Rita McGrath on October 12, 2011
Link to Rita’s webinar on complexity is now live
If you missed my September 28, 2011 webinar on "Learning to Live with Complexity" and would like to see it in recorded version, you can do so by clicking on this link.
The webinar discusses why complexity is different from the merely complicated because you can't predict the outcome by knowing initial conditions, and how living with complexity calls for somewhat counter-intuitive management practices.
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- Posted Rita McGrath on October 06, 2011
Rita Gunther McGrath short-listed in strategy category by Thinkers50
Rita Gunther McGrath was short-listed in the strategy category by Thinkers50, a one-every-two-years compendium of the world's top business thinkers. The category considers who CEO's would turn to for practical and imaginative strategic advice. Awards will be announced at a major event in November, 2011.
The complete shortlist can be downloaded here.
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- Posted Rita McGrath on October 05, 2011
recent entries
- Why just being young is not a reason to doubt Facebook
- Why advertisements need to get a whole lot better before they will support social media
- Bing, Social Search and the beginning of the App Economy
- In case you missed it, Rita McGrath’s interview about Mark Zuckerberg
- Rita McGrath will be part of the New York Times Business Live on May 11 (tomorrow!) at 10:00am
