About five years ago when instructor Alicia Dean-Hall needed to fill her classes at Central Park Dance studio in Scarsdale, New York, where she was a business partner with the owner, her obvious choice was to promote her services on Groupon.
"Running a Groupon was a no-brainer," she says. "If I had done an ad in the newspaper or something in the PennySaver, I would have had to pay a fee. Groupon is free, so I had nothing to lose."
However, she didn't expect the promotion to take off so well. Her growing class numbers coupled with the success of her Groupon promotions—about 100 for each promotion—enabled her to end her partnership with Central Park Dance studio and run her Dance Fit classes as her own business, while renting space from the studio, which benefits the studio and herself.
Cheryl Nadzam, co-owner of Across the Floor Dance in Woodbridge, New Jersey, echoed similar sentiments to Dean-Hall. "We wanted to promote the studio, never tried Groupon and figured why not?" The deals on Groupon have assisted in keeping her classes well-attended.
Running a Groupon deal to promote the studio is common for owners looking to boost classes and get people talking. However, when Groupon requires you to offer your service for at least 50 percent off the regular price, it's important to be strategic about the promotion. Here are five tips to help you create a Groupon deal that will have you leap into success.
Offer It for Specific Items or Classes
When offering classes at such discounted rates, it's important to avoid devaluing the service. Rather than an offer that includes all dance classes, Nadzam decided it would be better to include only the adult fitness classes and exclude the children's dance program. "A Groupon for our kids' program was too complicated to figure out, since you sign up in September and stay 'til June. We didn't want to discount that," she says. Both owners of Across the Floor and Dance Fit found that on occasion those who purchase the fitness classes through Groupon later enrolled themselves or a child in the dance class.
If you don't have a drop-in adult dance or fitness program and the children's classes are out of the question, you can consider running a deal on the apparel, yoga mats or dance shoes sold at the studio. Doing so can still assist with advertising and making a profit, because people learn what you have to offer without affecting studio culture.
Prepare Your Loyal Base
Offering your classes at a discounted rate to newcomers while your regular students pay full price could make some bitter. Don't publish the deal without a word. Instead, alert your current customers to it. "I had some people who were territorial and had problems with it, " says Dean-Hall. She dealt with the problem by explaining that the clientele brought in through Groupon assists in keeping prices affordable for current students of the program. Additionally, she does what she can to make them feel important by reminding them that they help set the tone for classes. "My current customer base is important because they show them the ropes." Alerting your current customers about the Groupon promotion also assists with advertising, because they pass the news of a deal to friends and family.
Create Specific Rules
Be very specific about the rules you have for your Groupon and be ready to enforce them. Usually rules include a 90-day expiration date, limits on the amount purchased, availability for new students only, inability to combine with other coupons and valid for specific classes. Once the rules are set, be prepared to enforce them and make sure the whole team is onboard. However, be prepared that some people may repeatedly purchase Groupon packages at the conclusion of the specified waiting period and never become a regular student.
Hook Them Again
Conversion rates for turning deal shoppers into paying students may be lower than the rate for converting those from organic leads, but it's possible. The trick is to have retention methods in place before you even run the deal on Groupon. Customer retention is an active process requiring following up, e-mail newsletters, membership opportunities and a clear call to action. Immediately, at the conclusion of a person's deal, entice them with a great student offer in person, send an e-mail, give a follow-up phone call and ask for feedback. If that doesn't feel right for your studio and clientele, find out what does, as long as you have a set schedule and process you can follow for keeping those Groupon shoppers hooked.
Additionally, encourage those who had a positive experience using the Groupon to post on social media or leave a review. Even if they don't become members of the studio, their review could attract someone who will.
Provide a Personalized Experience
While good bargains may draw in new costumers, a one-of-a-kind experience keeps them, says Nadzam. With the launch of a new Groupon deal, she prepares her teachers and reminds them to give a personal touch. "We're competing with other gyms that may offer fitness classes at cheaper prices, so we need to stand out," Nadzam says. Having instructors learn their names, encourage deal shoppers and being available to answer their questions is important for retention. Most important, never treat your discount students worse than you treat your loyal students.