Essay Example on Groupon Challenges: Consumer Behaviour & Recommendations

Introduction

The essay will look at the various challenges of Groupons highlighting certain factors such as a change in behavior and preference of customers, the perceived risks in the business and dissonance, the five-stage purchase process, and the influences that relate to psychology and sociology. The essay will also provide recommendations in the wake of these challenges as a way to ensure that such businesses don't fall out in place whenever they occur.

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Consumer Behavior

It is without a doubt that Groupons are suffering the challenge of consumer behavior. Consumers are flexible in nature, and this aspect of mobility makes the operation of Groupons to be challenging. In most cases, it is the idea of business people to give out discounted coupons hoping that the customers would be back for more purchases. It is an attributive factor of change in technology where consumers get to acquire new information and thus wish to move to other areas where they feel has a better purchase deal for them. For the company, the ideal recommendation to tackle this type of issue would be through learning more on the trends and possible shifts of consumer behavior to be able to anticipate future (Cantrell, Ganz, Emelle, Moore, Rath, Hair, & Vallone, 2017).

Perceived Risk & Cognitive Dissonance

Perceived risk and cognitive dissonance are personality challenges that business people should try to gauge and manage because they influence their business choices in the market place. Groupons are a challenging type of business marketing tool, and therefore, one should focus much on the ways of reducing cognitive dissonance and observe perceived risk to be more competitive in the market environment (Martin & Woodside, 2017).

One of the major steps is to change one's beliefs in the mode of operation because of the Groupons' nature if the business is founded on the unpredicted nature of consumer behavior and this then requires one to be flexible in their beliefs of business operation. In the same context, the CEO should be aware of the various perceived risks and try to make amends that would see a better approach towards the risks for the sake of the business survival in the market place (Smith, & Shock, 2019).

Five stage Purchase Decision Process

The five-stage purchase decision process includes the following:

Problem Recognition - here the consumer identifies a problem or the need that can be satisfied by a service or product. It is the initial change in the feeling which the consumer feels and would want to be satisfied by a product. As a business owner, one should be able to identify these changes and the supposed needs of the consumers and provide the required services and goods to satisfy them (Stoica, Cristescu, & Stancu, 2017).

Information Search - after the identification of the need, consumers then shift to looking for the information that suits their desire in a bid to find the services or products that they require. Consumers mostly acquire their information and do research through personal sources such as friends, through public sources like consumer rating organizations.

Alternative evaluation - right after the consumer has the information he was seeking at hand, they proceed to evaluate the available brands that can fully satisfy their want. In most cases and this is where business owners need to focus on is that consumers generally evaluate their alternative in relation to the product attributes and the degree of necessity.

Purchase Decision - right after the evaluation of their choices, consumers then tend to make a decision on what to purchase and the services to pay. In most cases, the consumers arrive at buying the best brand in the market. It thus requires that business people strive to remain competitive and right above their competitors in the market as a way to win consumers (De Mooij, 2019).

Post Purchase analysis - at the last stage of purchase, consumers tend to take action purely on the basis of dissatisfaction and satisfaction. At this time, the consumers make a determination of whether they are fully satisfied with the purchase they made, and at this stage, is where cognitive dissonance comes to play. Consumers at this stage try to determine whether they made the right decision.

Psychological and sociological influences

Psychological and sociological influences are driving forces that shape and determine the nature of purchases that consumers tend to make. Psychological influences relate to the personal beliefs that consumers have towards a product or brand and which shapes their purchase decision. Sociological influences relate to the surrounding factors, such as what people say of a certain product or brand also shapes their choices in product purchase (Damron-Martinez, & Jackson, 2017).

Recommendations

Groups have become a very challenging business strategy in the market environment. The unforeseen changes in consumer behavior, for instance, are some of the challenges that managers need to focus on achieving a competitive advantage. One of the recommendations I would give to the CEO of Groupon is to put much focus on consumer behavior and the factors that influence their purchase power at any time. Understanding consumer behavior and psychological influence on products and brands help a lot in the evaluation of strategies to take in better promoting the business (Smith, Shock, & Beaves, 2019).

Conclusion

Groupons represents a digital marketing tool that businesses are adopting for the purpose of increasing sales and attracting a big base of customers for their retail goods. It is a style of business operation where a business offers coupons on a discounted sale to groups. The digital marketing tool has attracted the operation of many businesses, and this has, however, proved to be challenging, especially due to constant change in the behavior of customers (Stephen, 2016). Business operators and Groupon managers are therefore required to look at the behavior of customers, for instance, in order to fully understand their shifts when it comes to product consumption and brand selection. Psychological influence and cognitive dissonance are some of the factors that managers need to address to incorporate a competitive environment for their businesses fully.

References

Cantrell, J., Ganz, O., Emelle, B., Moore, R., Rath, J., Hair, E. C., & Vallone, D. (2017). Mobile marketing: an emerging strategy to promote electronic nicotine delivery systems. Tobacco Control, 26(e2), e1-e3.

Damron-Martinez, D., & Jackson, K. L. (2017). Connecting Consumer Behavior With Marketing Research Through Garbology. Marketing Education Review, 27(3), 151-160.

De Mooij, M. (2019). Consumer behavior and culture: Consequences for global marketing and advertising. SAGE Publications Limited.

Martin, D., & Woodside, A. (2017). Learning consumer behavior using marketing anthropology methods.

Smith, A. D., & Shock, J. (2019). Gauging the Impact of E-Coupons on B2C Retail Markets.

Smith, A. D., Shock, J. R., & Beaves, R. G. (2019). Customer relationship management and the impact of e-coupons on B2C retail markets. International Journal of Business Information Systems, 30(2), 203-231.

Stephen, A. T. (2016). The role of digital and social media marketing in consumer behavior. Current Opinion in Psychology, 10, 17-21.

Stoica, L. C., Cristescu, M. P., & Stancu, A. M. R. (2017). RELATIONSHIP BETWEEN CONSUMER BEHAVIOR AND MARKETING STRATEGIES. Knowledge Horizons. Economics, 9(4), 79-83.