Groupon and Photobook Canada

By most measures, Valerie is much more active when it comes to finding a “deal” than I am, though we seem to sometimes fit the stereotype that women like deals on things they don’t need, with men paying any price for things they think they do (whether that’s actually the case). I’m not above taking a good deal – hence that bulk purchase of way more used photo equipment than any non-professional needs – but I don’t buy things just because they are cheap. So unsurprisingly, she’s used group buying services like Groupon, Living Social, and Google Offers a decent number of times; by contrast, I just finally used my first Groupon.

Note that I didn’t say that I just bought my first Groupon. That actually happened back in 2010 sometime, when Greg in the office said there was a deal on printing a photo book from Photobook Canada. For some reason, I bought four coupons – I don’t even remember for how much – each of which provided $115 of credit to be applied to a future order. It took a surprising amount of time to actually do this – even though I created just one book for photos from 2008, one for 2009, and made two copies of each. But I really didn’t have a choice, as I’d gotten a half-dozen nag E-mails reminding me that my Groupons were going to expire at the end of February (which I’m sure is part of the overall business model). I had inquired about cancelling for a refund – especially since I now live in the U.S., and Photobook Canada doesn’t even ship to the U.S. – but no dice on that. Fortunately, they do offer local pickup, so we’re going to ask our family back in Toronto to get the books once they’re ready.

I have two sets of comments; one on Groupon as a model, the other on Photobook Canada specifically (prior to having seen the books they produce, which will greatly affect my impression of them in one direction or another). First, on Groupon – and as always, these are just my personal thoughts:

• Groupon seems to be viable only for merchandise that is ridiculously overpriced to begin with.  Groupon expects a couple of things from businesses that offer deals.  First, you’re supposed to offer an “incredibly” good deal – 50% off the “normal” price of your merchandise is typically what you see promoted.  Second, Groupon takes some percentage of the deal you sold, and this percentage is also typically around 50%.  So the merchant has to think that it’s a good idea to essentially sell their stuff for 75% off, at least to get you in the door.
• This simply can’t happen for most fairly priced goods, unless a business is remarkably good at gouging it’s regular customers. Indeed, in the case of the Groupon I purchased, the real situation wasn’t as extreme as the deal would leave you to believe – because you were getting “$115 worth of Photobooks” based on prices that nobody actually ever pays. I’m not kidding about the latter; hit up the site, and you’ll see that non-Groupon purchases automatically get 30% off plus free shipping this entire month. Get their newsletter, and you could have picked up this deal a couple of weeks ago and gotten a $115 book for $50 (60% off!). In defense of Photobook Canada, that whole industry seems to operate on a model of inflated retail pricing that nobody ever pays, but in this respect, that’s exactly what Groupons seem to be designed for.
• By contrast, consider a place I like to shop – Costco. Nothing there is priced to rip you off if you aren’t price saavy, there’s rarely discounts/sales unless they really just need to get something off the floor, and their attitude towards the customer is exceptional. I bought a Blu-ray disc once and realized later that I must have dropped it somewhere. So I bought another copy, and just casually mentioned this to the cashier. They told me I should definitely check at the customer service desk, so I did. They had indeed found it, dropped in the slush in the parking lot. But they didn’t want me to take that one. No, they wanted me to keep the one in brand new condition and they just refunded the earlier order. But anyways, I don’t mention Costco to point out one anecdote on being customer focused. Take a look at their margins per their latest financials. For the last full year, they sold $88.9 billion of merchandise – which cost them $77.7 billion to buy – a markup of just 14%. And that’s just gross cost of goods – it doesn’t count the $8.7 billion expense of doing things like paying their happy employees; their net profit margin is just 2.4%.
• One of Groupon’s taglines is “collective buying power”. But if you stop and think about this, it doesn’t make much sense. Unless a manufacturer selling in bulk to a wholesaler and not dealing with any of the hassle and cost of working with individual customers, merchants selling through Groupon have to do everything they would normally have done in a 1-1 customer transaction; they save nothing from serving Groupon as a single entity. It’s purely a marketing vehicle to bring customers in the door.

I’m suspect of how long a business model for goods priced this way can last. Over the long term, I suspect that the cost of marketing your business via Groupon will have to fall in line with what it’s traditionally reasonable to spend on marketing as a portion of your total operating costs, which I don’t imagine that Groupon currently is. Groupon has certainly been smart in getting this far and growing so quickly, and I don’t fault them for finding something that works structurally in the current business climate – it just doesn’t seem sustainable to me, or like something that most businesses should participate in. But we’ll see – there’s lots of power in offering something that looks like a deal, even if that doesn’t tend to work on me!

So, Photobook Canada? I have to reserve most judgment till I receive the actual books I purchased, which will probably take a while since they’ll be in Toronto. If they’re super high quality, then any inconveniences along the way will seem pretty minor and I’d recommend them heartily. That said, the creation and purchase process wasn’t that smooth:

• Compared to a U.S. based service I previously used and found to be quite good (Viovio), very little information is shared on their website to give you a better feel for how what you’re doing in software will translate into a look of the final book. By contrast, Viovio had all kinds of information, details on the binding process, how the actual cutting/cropping of the prints happens, etc. I really feel like I have less of an idea what the books are even supposed to look like.
• The software that’s provided by Photobook Canada (which they license, but don’t make) is easy to use – but poor overall, in my opinion:
• You import entire directories of photos to use. There’s no nice interface for picking and choosing which you wish to use. As I was picking from many thousands of candidate photos, this just wasn’t workable – I had to make temporary directories outside of their software, then import those directories.
• Basic things like photo orientation (of JPGs produced by Nikon cameras, since I wasn’t shooting RAW in 2008/2009, sadly) were missing. I had to manually rotate every portrait photo!
• Zooming, cropping, and aspect ratio manipulation were a huge pain, and highly counter-intuitive.
• You’ll probably have multiple photos on a page. Want to keep them aligned? There’s a grid, which you can snap photos to. But stupidly, only the top left corner snaps to the grid. When you size the photo, it doesn’t snap to anything. So they only want to do a layout where photos share common dimensions is to actually edit the dimension of the photo.  Then, you get to go through the zoom/crop process again, since adjusting this messes that up.
• The software crashed several times. Fortunately, the impact of this was minimal, as it implements auto-save that worked decently for me.
• If your images aren’t exactly what you want already, your options are limited. The software has brightness/contrast controls, but increasing brightness uses some odd approach that trashes contrast. Effectively, if you want good results, you’ll have to have edited every photo you use before bringing it in. This is inconvenient, because your main edit for a photo may differ from what you want when presenting four photos side-by-side; in the latter case, you don’t want huge variations in brightness, saturation, etc.
• The ordering process is a somewhat confusing back & forth integration between their offline software tool, and their website. Creating two orders from the same project with different options (paper type, etc) requires you to duplicate the project (otherwise it says you already ordered the project).

Let’s hope the output quality is much higher than that of the tools provided to create the books! And here’s to hoping that Adobe Lightroom adds a module to do this across printing providers in the future!