I have even written a case that I plan to put in the next edition of our books — since it looks like daily deal promotion is here to stay.  I still question the strategy — which is why it makes for a great case — there is room to debate both sides.  The case made for fun discussion on the first day of class and one of my students tells me she works at a local restaurant that swears by LivingSocial coupons. I have previously questioned if a small business really wants these deal-prone consumers — because the deep discounts almost require them to spend more than the coupon or come back again for it to be a profitable promotion.

A second issue relates to the profitability of Groupon and LivingSocial — the two leaders in this space.  There is already a shakeout occurring among daily deal sites.  With such low barriers to entry, I have often wondered if anyone would really make much profit in this space.  One key is differentiation — and LivingSocial, which copied Groupon in the first place, is working at it (see: “LivingSocial Aims to Be Different from Groupon,“ BusinessWeek, September 22, 2011).  Groupon announced its own new product ideas back in March (“Are Four Words Worth $25 Billion for Groupon?” BusinessWeek, March 17, 2011), but I have not heard if these are working.  For a variety of reasons, Groupon’s IPO has been delayed.

The beer industry has recently come out with some very interesting packaging innovations.  This article, “Brewers Hope Consumers Will Judge a Beer By Its Cover” (AdvertisingAge, May 16, 2011 – I think that non-subscribers will be able to link to this article).  You can read about Coors Light bottles tell you when they are cold — and Miller Lite’s vortex bottles and nine other examples.  The article offers some brief critiques, suggesting “Why It Works” and “Why It Doesn’t” which might be useful discussion starters in class.  I could see a discussion of selected packaging innovations with a discussion about the appeal to target markets and consistency with positioning.

The examples could obviously be used when discussing product and packaging — but you could them as examples of differentiation.

The examples in this article highlight sources of differentiation.  It might be fun to go through the 4 Ps and talk about how each might be enhanced for a more upscale target market.