CMO Council study pours cold water on group buying sites

U.S.-based organization Chief Marketing Officer (CMO) Council has released a study of local marketing channels, one that suggests group buying sites such as Groupon and LivingSocial are not seen by national brand marketers as an effective generator of value. Of the 6% of survey respondents who use group-buying sites as part of their local marketing mix, […]

U.S.-based organization Chief Marketing Officer (CMO) Council has released a study of local marketing channels, one that suggests group buying sites such as Groupon and LivingSocial are not seen by national brand marketers as an effective generator of value.

Of the 6% of survey respondents who use group-buying sites as part of their local marketing mix, only 2% identified such sites as the channels that drove the most value and return on investment. Instead, national marketers pointed to channels such as experiential events, direct mail and interactive digital signs as the leading ways to reach consumers at a local level.

The group buying findings were part of the CMO Council’s “Localize to Optimize Sales Channel Effectiveness” study.

Survey by: CMO Council

Methodology: Survey of more than 300 brand marketers across the world, including senior marketers representing major global brands such as Burger King, Toyota and Coca-Cola, in Q2 and Q3 2011.

Key findings:

  • 6% of national brand marketers use group buying websites to reach local consumers
  • Only 2% of those who use group buying sites say they are the most effective local marketing channel
  • 50% of respondents said local marketing is essential to business growth and profitability
  • Only 12% of those surveyed consider themselves highly evolved and knowledgeable when it comes to local marketing
  • 23% of national brands surveyed intended to expand local marketing budgets
  • 49% said they were looking to explore new local marketing channels
  • When asked to identify obstacles to improving local marketing, 31% of respondents pointed to the challenge of understanding local markets, 23% said it was difficult to find local marketing experts and 23% mentioned difficulties in determining appropriate cost-benefit models for local spending.
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