Attract
Deals bring new customers through the door.
Work/Groupon
04 · Groupon · Commerce · 2015–2018
Groupon needed merchants to come back after one deal
More than 60% of merchants left within a year, most citing return on investment and lack of exposure. I argued that Groupon had to stay valuable after a single deal, and made the case for a platform that helped merchants attract, engage, and retain customers.
The problem
More than 60% of merchants left within a year. 56% of those who left decided while their deal was still running, citing return on investment and lack of exposure.
What we did
Proposed a platform to help merchants attract, engage, and retain their own customers. Won approval to rebuild Merchant Center as the foundation: a completed mobile experience, easier redemption, and stronger deal-health analytics.
Results
Merchant satisfaction rose 200 basis points quarter over quarter after the redesign, and the platform supported four new products.
- Role
- Director of Product Design, Merchant, 2015–2018
- Owned
- Product strategy and design for the Merchant platform, Redemption, and Analytics
- Team
- 11 in design across five locations
- Partners
- 8 PMs and 10 engineering squads
The problem
A deal that didn’t pay off ended the relationship
Merchants paid for a Groupon deal with discounted sales and a share of the margin. They expected new customers to return at standard prices. Instead, customers often treated the discounted price as the value of the service, undermining the economics of repeat business.
60%+
of merchants left within a year
Q2 2015 US merchant attrition study
56%
of those who left decided while their deal was still running
Same study
74 → 61
merchant satisfaction, mid-2013 to December 2015
Later research showed why results mattered: 74% of merchants who got the customers they expected planned to return, against 20% of those who didn’t.
The strategy
Attract, engage, retain
Leadership saw deals as inventory to sell to consumers. My premise was that Groupon could help merchants build a business around their own customers: bring new customers in, encourage them to return, and win back the ones who stopped coming.
Engage
Frequent-buyer or loyalty programs encourage those customers to return.
Retain
Lightweight CRM helps merchants reconnect with customers who tried the business and stopped coming back.
How we learned it
With my principal designer and our user researcher, we visited merchants in their places of business and combined field research with behavioral and funnel data.
Making the case
I used the journey map to make the case to our VP of Product and CPO: a deal could be the start of a merchant’s relationship with its customers, extended through loyalty programs and eventually lightweight CRM. They approved rebuilding Merchant Center as the first step. The harder sell was the PM who owned the backlog, whose roadmap was incremental and whose team would need a new design approach on a new tech stack. The merchant satisfaction trend, alongside a speculative prototype from my team, changed that conversation.
Field research
Visiting merchants where they work
The visits also showed how Groupon won merchants. In 16 interviews, split evenly between low or no intent and high intent, interest rose when someone a merchant knew had used Groupon. A sales pitch carried less weight.
In their words
“One of the hair stylists at Sola Salon uses it and she recommended it.”
Business manager, day spa (high intent)
“If we ever decided to run a Groupon, I would talk to managers at other venues, because they have first-hand experience.”
Manager, entertainment venue (medium intent)
“I am not a discounter. My circle of friends and business owners would be upset if I ran a Groupon.”
Owner, massage studio (no intent)
What we delivered
Merchant Center: the delivered foundation
The rebuild gave merchants a completed mobile experience, easier redemption, and stronger deal-health analytics, on a new stack. Two PMs and twelve engineers in Berlin built it, and the journey map aligned teams in Berlin, the US, and the UK on priorities.
Before
After: redesigned dashboard
Delivered
Merchant Center rebuild
A completed mobile experience, easier redemption, and stronger deal-health analytics. Project team: 4 designers, 2 PMs, 12 engineers, 10 time zones. First milestone: feature parity.
Concept
Lifecycle concepts: loyalty and CRM
Frequent-buyer and loyalty programs, and lightweight CRM for winning back lapsed customers, were concepts within the strategy. They show where the platform was meant to go after the delivered foundation.
The wider design organization: 11 people across five locations, supporting 8 PMs and 10 engineering squads in 28 countries.
Results
Merchant satisfaction rose 200 basis points after the redesign
+200 bps
merchant satisfaction, quarter over quarter, following the redesign
4
new products on the platform, including Groupon Beauty and restaurant delivery
Measurement context
The rise followed the redesign; it was not isolated in a controlled test. The four products, including Groupon Beauty and restaurant delivery, were built on the rebuilt platform.
The team
The Groupon merchant design organization
The designers behind the Merchant platform, Redemption, and Analytics, working across California, Washington, Utah, Illinois, and Berlin with 8 PMs and 10 engineering squads.
Liz
Ken
Janet
Jackie
Emily
Amethyst
Joanna
Joy
Vadym
Igor
Raza
Mat
Michael