Groupon for Owners

How is this marketing concept working for you? Would you recommend?

[Robin Garr]

The New York Times had a front page article today that bore directly on this issue. (Maybe that article inspired this question?)

Coupon Sites Are a Great Deal, but Not Always to Merchants
http://www.nytimes.com/2011/10/02/busin ... odayspaper

The New York Times had a front page article today that bore directly on this issue. (Maybe that article inspired this question?)

Coupon Sites Are a Great Deal, but Not Always to Merchants
http://www.nytimes.com/2011/10/02/busin ... odayspaper

With the exception of ATL, I've never returned to any of the business's I've visited because of groupon/living social.

This paragraph from the NYT story says it all:

"The consumers were being told: You will never pay full price again. The merchants were hearing: You are going to get new customers who will stick around and pay full price. Disappointment was inevitable."

Yep.

I tried Patticakes Pies & Cakes in downtown NA through a Groupon and *have* returned to pay full price. Same for Gigi's Cupcakes and Dish on Market.

I agree that it does set expectations differently for both parties- and leads to disappointment for some. And companies who don't carefully set their limits can end up with a negative impact.

Unlike David, I've personally found a number of new places thru Groupon that I have frequented again ( and I always end up spending more than my Groupon on the Initial visit. ); I've also driven to places that I wouldn't normally bother with. I find that they are also very good reminders about places that I haven't been to for a while- it makes them "top of mind". And even though I try to manage my Groupons/ Living Social deals well, I still ended up throwing away 3 expired deals last month- including one to our fav TheatreSquare ; the merchants get a good deal of revenue from this.

An aside: a recent deal for Fresh Start Growers had an expired "deal" date of $30 but maintained its orginal value $15 for another year. Really thought that was a great marketing tactic- the whole point is to get people in the door.
Deb

Deb,

I believe by law, the paid-for value cannot expire...only the promotional value. So don't throw them away; take them in and see if you can use them for what you paid.

Kari,

You are absolutely right- Thanks! This from Groupon's Merchant site:
Groupon is a service provider for the Merchant identified on the voucher and the Merchant is the sole issuer of the voucher. Vouchers have two separate values: (a) the “amount paid” and (b) the promotional value. The “promotional value” is the additional value beyond the amount paid. Together, the amount paid and the promotional value equals the “full offer value” of the voucher. For example, if you pay $20 for a voucher that gets you $50 of goods or services from a Merchant, the full offer value is $50, the purchase value is $20 (this amount does not expire until it is used or is refunded), and the promotional value is $30 (this amount expires on the date stated on the voucher unless expiration of the promotional value is prohibited by law).

If a Merchant or venue refuses to honor any voucher, Groupon will refund the amount paid upon request in the original form of payment, or will credit the Groupon account of the purchaser with an equivalent number of Groupon “Bucks” for future purchases on the Site. Groupon Bucks do not expire.
I read in the NYTimes that the largest revenue for some establishments is from not redeemed coupons. And I mis-interpreted what that meant. Thanks for straightening me out.
Deb

Here at Gelato Gilberto we used Groupon on two occasions. Despite some hiccups, we were happy with the results. The main reason for the satisfaction on our part is that we, as retailers, had a very clear idea on what we wished to achieve with the Groupon promotion. By using the Groupon method we thought we could achieve three things; attract new customers, reward loyal customers, and gain exposure to the massive Groupon database.

Of course, there were customers who made the drive to our gelateria, cashed in on some lower-than-foodcost delicious gelato and drove off into the sunset never to be seen again (until the next Groupon promotion). Of course, there were long-lost friends who never took time to visit us before but managed to stop in brandishing their Groupon printout. Of course, there were customers trying to use the Groupon after its expiration date.

None of this bothered us because we met hundreds of new customers the majority of whom have honored us with subsequent visits. We simply tried to concentrate on the overall benefits of the promotion while dealing these transient issues. By remembering our objectives, we were able to tolerate the more noisome aspects of the promotion.

To anyone considering employing the groupon/living social style coupon, I would offer one or two tips. Keep the offer very simple. Busy consumers are not going to read the fine print. If a consumer is confused or by the offer and its terms, try to err on the side of the customer. Right or wrong, they are visiting you to try your service or product. That is your chance to keep them forever. They do not need a lecture on reading the fine print. And, finally, just accept the fact that a certain portion of the population is solely driven on deals, specials, or coupons and you will probably not see them again. If your service or product is strong the return customers should more than offset this avaricious minority. Just my two cents…(which you can get for one cent by taking advantage of my special offer…)

As someone who is a major Groupon/Living Social/Try It Local addict, I've eaten at many places I never would have had it not been for the discount, and eaten at many places way more often than normal because they had a Groupon special come up. Without a special, I may or may not make the haul out to Shelbyville Road or Hurstbourne Lane for something; with a Groupon, I'll make a special trip for some Shalimar or to get a kuchen from Heitzman.

I love food, and I love trying new things, but I hate paying full price for something I might not like.