Groupon’s communication misstep (alleged…more about this later) continues to fascinate me. Here’s a darling start-up that media loves and if you go by their press page, media seems to be going completely ga-ga over them.

And what do they do? They create a series of ads for premiering at THE Superbowl and blow their big chance – by making ads that are being talked about for all the horrendously wrong reasons. Not just in the US, but also in distant China, where they are planning to start their operations! And to think they spent US $3 million to place these ads!!

Here are the 3 purportedly-insensitive ads.

Tibet

Brazilian Rainforest

Save the Whales

The ads are insensitive or not depending on who you are. As a PR professional, I find them strange – they seem to cash in on real-life causes in an irreverent way and in a way, cashing in on them; though they do not talk about the matching grants Groupon makes to those causes and that is indeed a silly omission. But all this seems perfectly fine until you read this blog (Could better PR have prevented Groupon’s China gaffe?), by William Moss, Director of Communications, North Asia, for Motorola Mobile Devices, based in China – basically, Groupon seems to have blown their chance to do any decent business in mainland China with that Tibet ad!

A tactless ad campaign is one thing, but a tactless ad campaign that impacts real business is entirely another – Groupon seems to have pulled both in one expertly woeful stroke! That question by Will – could better PR have prevented Groupon’s China gaffe? – is bang on target, particularly,

“a good PR person is one who can, among other things, look at business decisions being made and tell the management what those decisions will mean for the companyâ??s reputation among all the audiences that matter”

In their justification, Groupon’s CEO, Andrew Mason touches upon only the tactless part of the ads and not the impact on their potential business in China…quite understandably. He also stands by the agency that made these ads, the very-celebrated Crispin, Porter + Bogusky.

The firm that conceived the ad, Crispin Porter & Bogusky, strives to draw attention to the cultural tensions created by brands. When they created this Hulu ad, they highlighted the idea that TV rots your brain, making fun of Hulu. Our ads highlight the often trivial nature of stuff on Groupon when juxtaposed against bigger world issues, making fun of Groupon. Why make fun of ourselves? Because itâ??s different â?? ads are traditionally about shameless self promotion, and weâ??ve always strived to have a more honest and respectful conversation with our customers. We would never have run these ads if we thought they trivialized the causes â?? even if we didnâ??t take them as seriously as we do, what type of company would go out of their way to be so antagonistic?

Apparently, the agency has also been rallying behind the ad. Miles Nadal, chairman and CEO of MDC Partners which owns the agency, has this to say about the ad campaign,

It’s been exceedingly effective… They have over 50,000 new customers that have come on board since the ad ran, so its actually drawing the kind of business performance that we expected it to… You have to understand there is a difference between popularity and business effectiveness. Strategically Groupon has always dealt with social issues from the very evolution of the business… We’re happy to be part of the conversation.

So they chose to stand by the ad after all, despite sounding like they are not so pleased about its outcome (Mason ends his blog post with, “The last thing we wanted was to offend our customers â?? itâ??s bad business and itâ??s not where our hearts are.”).

The Groupon ad mess is one more reason to integrate PR at the center of business decisions, as Will explains beautifully in his post. I was left wondering who Groupon’s PR agency was. As always, I did a search and landed on a Quora response, from a UI designer at Groupon! The question was,

Which PR firms handle Twitter, Facebook, Groupon, and other recent leading internet startups?

The only response (so far) is by that UI designed. He says,

At Groupon, our PR is handled internally, headed by the more than capable Julie Mossler.

The response is dated December 23, 2010, quite some time before all this mess happened. I read and re-read the tag that UI designed used to describe their communications pro – ‘more than capable’. I won’t blame that person since blaming someone after this event is stupid and pointless, but I just wonder how things may have been if they had a professional communications agency handling their PR. Would the collective experience of a professional communications firm have explained how these ads may be perceived by audiences, not just in the US, but in all those markets Groupon is interested in expanding into?

Related read:
1. Grouponâ??s Superbowl: Social media (C)PR
2. Rewriting Groupon’s justification into something more effective

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