Groupon, the rapidly growing online coupon provider, has gone from a small startup in Chicago to become one of the world’s hottest web companies, one that even managed to turn down an offer to sell to Google. For the uninitiated, it takes the concept of group buying of coupons and turbo charges it through apps, email and its website.
It’s something that naturally found a home in Japan where a number of similar sites sprung up, all catering to different tastes and markets. Late last year, Groupon purchased one of those companies and has been formalizing its presence here ever since – you might have seen its grating TV ads on Japanese networks (see below if not).
However, yesterday the company CEO took time out from that explosive growth to apologize to Japanese customers for a New Year’s deal gone wrong that highlighted the difficulties the company faces in managing its expansion across different cultures.
In a subtitled video message uploaded onto YouTube, the company’s founder and CEO Andrew Mason acknowledged that the company had “really messed up” and outlined steps it was taking to rebuild its tarnished image in Japan.
“We created Groupon to help enrich people’s lives by bringing new exciting experiences to them,” he said. “So when we do the opposite, as we have in this case, it really hurts.”
The blunder that prompted Mason’s apology involved a deal for delivery of “osechi,” which is a traditional New Year’s meal. Osechi usually includes a variety of Japanese dishes painstakingly prepared and beautifully presented.
Unfortunately, some customers who paid 10,500 yen for this particular bargain were left feeling like they had been duped.
Many of the 500 osechi sets sold arrived late, while others’ meals were in “terrible condition,” Mason said. In an explanation earlier this month, Groupon Japan said the sets didn’t match the picture or description provided by the restaurant, Bird Cafe, which was overwhelmed by the volume.
Angry customers took to the Internet, posting pictures of the underwhelming delivery on message boards, triggering a slew of criticism and bad publicity for the company.
Groupon subsequently refunded customers’ money and offered them vouchers worth 5,000 yen — a move which so far that seems a fair amount of Japanese will be satisfied with. It is similar to apologies done by Japanese executives (Toyota, for example) when they blunder, though Japanese media did note the failure of Mason to bow deeply. If you screw up in business in Japan, be sure to apologize asap (and bow).