Presented by Chris Johnson of Groupon

1. THE SCIENCE
BEHIND DISCOUNTING

2. Differentiation
Why it’s still an important factor in today’s ecosystem
The Science Behind Discounting
Why it’s important plus global examples of campaigns with science underpinning them.
WHAT WE’RE COVERING

3. INDUSTRY
DIFFERENTIATION

7. CONTINUED COUPON DEMAND

8. “The next time you’re making a change in your company, launching a new product, or even re-defining
your brand, stop asking yourself where you can fit in your current space, and ask yourself what you can
do to stand out, instead.”
Steve Harvey, Fabrik
Differentiation and value-add is becoming more of
a challenge.
To be innovative and successful, we have to:
● Do something that makes life easier or more innovative
● Find a way to stand out from the crowd. Think differently.
VALUE-ADD IN COUPONS

9. Ad: Burger King
with Google
Home
Product:
Whopper Burger
https://youtu.be/OUj8SUoJ-ZM

10. THE SCIENCE BEHIND
DISCOUNTING

11. Rory Sutherland
Chairman @ Ogilvy
Richard Shotton
The Choice Factory
The masters of behavioral economics

12. ● Scarcity Principle
● Complementarity
● Value Perception
● Relevancy
● Social Bias
● Price Anchoring
Heuristics
BEHAVIOURAL ECONOMICS & COUPONING

13. Heuristics
Are simple, efficient rules which people often use to form judgments and
make decisions.
Also referred to as your brain’s mental reflexes and rapid insights.
BEHAVIOURAL ECONOMICS & COUPONING

14. Pakistan against England for the
2017 ICC Champions Trophy
Yasiel Puig (LA Dodgers) catch vs.
NY Mets, 2014. MLB; YouTube.

15. HEURISTICS
IMAGE SOURCE: BYNDER

16. HEURISTICS
IMAGE SOURCE: BYNDER

17. HEURISTICS
IMAGE SOURCE: BYNDER

18. HEURISTICS
90 meter distance
Peak height
Travelling at 92mph
48.7 degree angle of trajectory
IMAGE SOURCE: BYNDER

19. SCARCITY
PRINCIPLE

20. Scarcity. FOMO. Exclusivity.
We know it by many names, but it’s all fundamentally about the same thing:
if it’s hard to get, it must be worth something.
The Scarcity Principle
People attach more value to things that are few in quantity.
SCARCITY PRINCIPLE

23. SCARCITY PRINCIPLE

24. Lock in this great
price while you still
can
Booking.com is a master at scarcity
marketing. Take a look at how they
imply that this deal on a hotel won’t
be available for very long
SCARCITY PRINCIPLE

25. 3 People are
looking right now
You may also notice in the screenshot
above that Booking.com share how
many other users are currently
viewing the same hotel you are
viewing. Better book now before those
4 other people get the room you want!
SCARCITY PRINCIPLE

26. COMPLEMENTARITY

27. Complementarity
A relationship or situation in which two or more different things
improve or emphasize each other's qualities.
COMPLEMENTARITY

28. Greg has just bought flights
from Delta.
The next day he’s sent a
complimentary email offering 10% off
bookings and a deal on Travel
insurance.
He books a hotel & orders travel
insurance.
Cross-selling to
increase sales
Hotels.com Exclusive
10% off bookings + a great rate
on Travel Insurance
!
Elly has shopped twice at Crew
Clothing in the last six months but
never before at Joules.
She’s sent an email with a Joules
exclusive for new customers.
She makes a purchase.
Targeting new customers
Joules Exclusive
10% off at Joules for new
customers
!
COMPLEMENTARITY
Maximising revenue automatically through
complementary offer creation and promotion

30. IMAGE SOURCE: BYNDER

31. IMAGE SOURCE: BYNDER

35. Buy a bike from Evans Cycles and get free
entry to any National Trust location
Evans Cycles + National Trust = +
Free $50 Amazon, M&S or John Lewis Gift
Card with all car insurance at Direct Line
DIrect Line + Retail = +
Book your train ticket with the Trainline
and have a Starbucks coffee on us
Trainline + Starbucks = +
Spend $200 at Game and get a takeaway
on us with a $20 JustEat credit
Game + JustEat = +$
COMPLEMENTARITY

36. VALUE
PERCEPTION

37. Value Perception
Lies at the heart of marketing and deals solely with the
customer's perception of a product.
SCARCITY PRINCIPLE

38. Ad: Diamond
Shreddies
By: Ogilvy
https://youtu.be/ZV6xrmm2mII

39. Ad: Diamond Shreddies By: Ogilvy

40. 18% Increase in Sales
Ad: Diamond
Shreddies
By: Ogilvy

41. Perception manipulation
If you change the way someone looks at something,
you change their value of it.
VALUE PERCEPTION

42. VALUE PERCEPTION

43. Spend $80 and get a
$5 same brand reward
ACTION BENCHMARK OUTCOME
Spend $80 (ORDER 1) Programme AOV = $50 + $30
Get a $5 M&S Reward $5 offset from additional ORDER
1 revenue
+ $25
Spend $5 M&S Reward
(ORDER 2)
On average, shopper spends 30%
more with use of a reward
+ $65
Results? 2 Orders ($75 + $65)
AOV = $70
ATF doubled
AOV Gain = $20
IMAGE SOURCE: BYNDER

44. RELEVANCY

45. Relevancy
the quality or state of being closely connected or
appropriate to someone.
SCARCITY PRINCIPLE

46. Total Amount from 01/05/2014 through 31/05/2014

47. Total Amount from 01/05/2014 through 31/05/2014

48. Eurovision Song Contest, Vienna,
BBC 1; 2015

49. 180,000,000
Viewers Annually
6,900,000
UK viewers

50. Total Amount from 01/05/2014 through 31/05/2014

51. Target Customer
Annie. Age: 28
Vouchercloud Food-to-Go consumer
High volume vc user
Never ordered from JUSTEAT
8AM
Browses emails on waking. Sees vouchercloud
email containing JUSTEAT voucher
3:30PM
Browsing on Facebook - served branded
JUSTEAT advert by vouchercloud
Colour Psychology – the JUSTEAT ‘red’ was consistently
used throughout messaging, subtly reminding users of
the brand
Scarcity & Urgency – invoking a sense of urgency with
our last-minute push notification, 30 minutes prior to
Eurovision’s ‘showtime’
The “foot-in-the-door” technique – users who showed
any interaction with our communications were then
given tailored follow-up messaging that played on their
previous interactions – i.e – “Still looking for that
takeaway? Up to 20% off local eateries with JUSTEAT
tonight!
7:30PM
Push sent to mobile as TV show starts
resulting in order
JUST EAT your way through Eurovision

52. Google Maps 2019

53. Google Maps 2019

54. Campaign Statistics
8.6m Emails sent
33k Offline to Online engagements
21% Email open rate
2% Email CTR
10% CTR on Push Notifications
4% Average CR
1000+ Sales Driven
622% Uplift YOY
658% Uplift MOM
160k Engagements within Category

55. SOCIAL
BIAS

56. The Bandwagon Effect
is characterised by the probability of individual adoption
increasing with respect to the proportion who have
already done so.
SOCIAL BIAS

58. Single Choice
“Apple made a simple design choice in 2001 that
sent it into the stratosphere”
- Chris weller
SOCIAL BIAS

59. Ad: Apple + iPod
+ Itunes
Product: iPod

60. Ad: Apple + iPod
+ Itunes
Product: iPod

61. Ad: Apple + iPod
+ Itunes
Product: iPod

62. Ad: Apple + iPod
+ Itunes
Product: iPod

63. Booked 26
Times Today
Booking.com also tells you how many
times a particular hotel has been
booked today, which means the hotel
must be a desirable place to stay (and
you’d better book your stay now
before they’re all booked up).
SOCIAL BIAS

65. PRICE
ANCHORING

66. Anchoring
Refers to the tendency to heavily rely on the first
piece of information offered when making
decisions.
PRICE ANCHORING

67. IMAGE SOURCE: ADAM TOW,
ALLTHINGSD.COM

68. $999
IMAGE SOURCE: ADAM TOW,
ALLTHINGSD.COM

69. $499
IMAGE SOURCE: ADAM TOW,
ALLTHINGSD.COM

73. Rory Sutherland
Chairman @ Ogilvy
Richard Shotton
The Choice Factory
The masters of behavioral economics

74. IN SUMMARY
Differentiation remains a key focus
Our campaigns are shifting to creativity and
an improved focus on user behavior
Groupon Coupons needs YOU!

75. Thanks for listening!
Any Questions?
Dan Flannery
dflannery@groupon.com
Chris Johnson
ceej@groupon.com