From the Startup Scene: Groupon Gets Personal

That said, one could argue that the more crowded the space is, the more important execution becomes–when there are five (or ten) competitors elbowing each other to get consumers’

attention, there’s not a lot of room for a badly executed product. And right now, one space that’s becoming increasingly crowded is collective buying.

Collective buying companies have become so ubiquitous that there’s now a whole company called Yipit designed to aggregate all the group deals out there. On the other side of the transaction, a company called City Pockets helps consumers manage the numerous deal vouchers they’ve acquired. Both these companies solve an interesting problem: people are now simply being bombarded with too many group discounts to keep track.

Still, in the face of this rapidly expanding suite of competitors, Groupon still seems to be somehow able to stay ahead of the curve. They’ve just announced a new Personalized Deal functionality. TechCrunch’s Jason Kincaid does an excellent job of highlighting the key elements of the program, but ten-cent version is that users will now be segmented and shown deals most likely to interest them.

This development signifies a couple of interesting things. First, Groupon isn’t resting on their laurels of being the first company out there to really get the collective buying model right–they’re pushing the boundaries into the next frontier of the market. Second, this strategic decision is evidence that Groupon thinks customers can be better served if they are provided with services targeted to their demographic as opposed to wholesale solutions.

The personalization angle is something we subscribe to at Betterment; in fact, it’s a core element of our product. That’s why we provide features that allow users to compare their investing habits to others in their demographic. Even though our product is designed to work for an extremely wide spectrum of consumers, the way each user interacts with us will, and should, be different. And, like Groupon’s personalization, we’re aiming to combine the convenience of a one-size-fits-all service with the effectiveness of an individual solution.