Groupon Case Study Decisions

Groupon Finds Up to 60% of Direct Traffic Search

Gene McKenna, Director of Search, Groupon does groundbreaking study by deindexing site temporarily

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Understanding what traffic came from what channel is easier in digital marketing than it ever was in offline marketing. Digital marketers make rational decisions on the success and failure of campaigns and what to do with the budget based on reliable information from their web analytics tools. But what if the reporting in two of the largest online channels is less reliable than everyone thought? What if 60% of direct traffic which is usually attributed to PR, social, offline, and brand, is actually traffic from search engines with the domain referrer stripped off? That would mean that search’s contribution would be undercounted.


Gene McKenna, director of search at Groupon, set out to answer this question and was willing to take drastic action. His hypothesis was this: If referrers are 100% accurate for direct traffic, then turning off the search traffic by setting a de-indexing command for the whole site would have no impact on direct traffic.


What McKenna found was that direct traffic on interior pages dipped in a highly correlated way with the search engine traffic dip. If direct and search traffic were equal, for every 10 search visitors that were lost after de-indexing, 6 direct visitors were lost also. He found that the effect was more pronounced on interior pages with longer URLs and up to 75% of some Internet Explorer browser search traffic was reported as direct. That means that surveys like BrightEdge’s Channel Performance white paper, which found 51% of visitors coming from search (excluding direct as a channel), is still understating the proportion that comes from search engines. Both research studies confirm the significant opportunity most companies have to increase the business value they derive from search traffic. The decreased reliability of query and referrer information makes having an SEO platform more important than ever.

The referrer is a weak link in SEO reporting.


Subscribe to Valuetainment: Groupon Case Study for Entrepreneurs- The Biz Doc, Tom Ellsworth dives into case study #5 with a lesson on business models and reputation management. This lesson is derived from the pioneer of digital marketing you may know as Groupon.

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About Tom Ellsworth: THOMAS N. ELLSWORTH, is an experienced CEO / COO and veteran entrepreneur. He has been disrupting industries and driving consumer shifts through Venture-backed companies in technology, software development, publishing and mobile that have generated exits totaling over $1B. Watch the interview with Patrick Bet-David:

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About: Groupon is an American worldwide e-commerce marketplace connecting millions of subscribers with local merchants by offering activities, travel, goods and services in more than 28 countries.

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