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Home » Technology

Groupon? I’d Rather Buy Poupon… Grey, that is

Last updated by on 19 Comments

If this post header doesn’t win some kind of award, there is no justice in this world.

So… little story.

I’ve been subscribed to Groupon (two years), Google Offers (9 months), and a local media outlet’s (1 year) “daily deal” email updates for a while now.

My thought going into it was that I would simply subscribe, and if an offer were to come through that:

a. was from a merchant I frequented

or

b. was from a merchant I have been meaning to check out

then I would purchase it at the significant discount (usually 50% off or more). What does it hurt to get a free email alert and delete it from my inbox, if it’s not relevant? Besides, I live in a city with a population exceeding 100,000. There must be some great deals to choose from, right?

grouponTwo years later, I haven’t bought one damn daily deal.

If I were in the market for a spa facial treatment, a manicure, a 2-for-1 putt-putt, a buy-1-get-1 meal at the crappy restaurant in town, auto detailing, or someone to print off cards for my imaginary business, then I’d be a very happy man these days.

But all I see is the worst of the worst businesses participating.

Sure, there was the time when LivingSocial offered an Amazon $5 for $10 deal, but that was only because Amazon had an ownership stake in LivingSocial and wanted to give them a boost. These are far and few between (and if they do come around EVERYONE knows about them, so the email alerts are pointless.

So why are there never any good daily deals?

I think it all boils down to one thing: these deals are a horrible value to the business owner that offers them. They might get people in the door, but it’s the wrong kind of customer, and it’s usually at a loss.

If you are a solid business that is well known and established, you’d be foolish to participate in a daily deal. You’re making good money, there’s no reason to lose money on a promotion. If you are a new business that kicks ass, do you want to give a cheap ass like me half off? Probably not. You’re probably already generating some good local organic buzz on your own. The early adopters like to spread the word. So the daily deal site sales reps sell the bottom of the barrel businesses because they have to hit their sales quotas.

So. Here’s a piece of advice for all of you: UNSUBSCRIBE

Let’s say you sign up for 6 different alerts (i.e. 3 websites, two locations/categories with each). This means you get six emails daily. Let’s say that it takes you 5 seconds to look at and then delete each of those alerts. That’s 30 seconds a day. Multiply that out over a year, and you get 10,950 seconds, 182.50 minutes, or just over 3 hours. Of your life. Wasted. Every year.

That’s best case scenario. Worst case, you actually do get tempted to buy a car detail for $100 when you could do it for free on your own. Or the deal sites end up selling your email to spammy businesses.

What they aim to get us all on is the hope of that ONE AWESOME DEAL. Who would want to miss that!? In two years, I’m still waiting for it… please pass the Poupon.

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About the Author
I am G.E. Miller, & this is my story. My goal is financial independence ASAP. If you share that goal, join me & 7,500+ others by getting FREE email updates. You'll also find every post by category & every post in order.


19 Comments »
  • Megan says:

    I subscribe to them and have bought a few, but I usually do think twice about how poorly the establishment must be doing to “resort” to something like a daily deal and what kind of experience I’ll have as one of hundreds(?) of new customers trying to come in and save a few bucks. I’ve found the services (massages/nails) are not great and the employees are frustrated with the kind of people who are coming in to cash in on the deal (as you said, it attracts the wrong type of clientele), but I did have a good experience with a yoga studio and just bought another from the hottest yoga studio in town. I was really surprised they offered a deal and had to jump on it, but am wary of what my experience may be like when I try to cram in my 10 classes along with everyone else in town. I don’t think I’m ready to unsubscribe, but I am ready to buyer beware!

  • Deanne says:

    I also signed up for Groupon and similar websites with the intent of using them to find deals on places I already visit or have wanted to go to. But over time I’ve found that those sites are actually a great source for finding discounts on more unusual items. If I’m traveling somewhere I will often search Groupon randomly for a couple of days looking for big ticket experiences in the city I’m visiting in order to score a great deal on something super expensive. For example, when I went to Seattle I found 50% off a glass blowing lesson for two people which was awesome (something my traveling companion and I both wanted to do) and would have been out of the question if it wasn’t heavily discounted.

    I also use it a lot when I sign up for adventure races. Most adventure races (like Warrior Dash, Mud Runner, etc) have a graduate entry fee which gets more expensive as you get closer to the day of the race. But you can often find heavily discounted tickets on Groupon-like sites in the month before the race so you don’t have to sign up so far in advance but also don’t have to pay two or three times as much for signing up later.

    Other than that it’s not a great deal and the email notifications never mention those things. But it is a very useful tool for finding discounts on otherwise expensive experiences.

  • Krirs says:

    What are your thoughts on travel deals, like livingsocials escapes or groupons getaways. I haven’t bought one to date yet, but some of them seemed amazing. I did see one for Aruba recently but after reading the fine print of 22% tax, I deferred. So how are they making money then from these travel that’s heavily discounted?

    • G.E. Miller says:

      My guess is that they only opt in to something like this when they are out of season and they know they are not at max capacity. An empty room is a loss to a hotel/resort. A room at a steep discount is better than nothing for that business.

    • Bryan says:

      Don’t buy the travel deals, they are all horrible deals and designed for people who just think they are a good deal. Almost all of the packages do not include flights, but if you do a little research you can find the same deal including flights for cheaper!

      • Kris says:

        Bryan, what about your opinion on the ones that are close-by to you where you could drive to get there?

        • Bryan says:

          I think the local ones are often a better deal, I live in NYC so I do not have a car and a lot of these are day trips etc that include transportation. I think the quality of groupons depends on the size of the city you are in, here in NYC we have some decent deals to good restaurants.

          • Tyler says:

            I have bought a few “weekend getaway” deals for my girlfriend and I and have had great experiences at every one. We decide about 2 months in advance we want to do a weekend away and monitor all the sites. The trick is you have be willing to go wherever the best deal is, opposed to deciding where you want to go and looking for deals in that town. For example, we stayed at a hotel less than 1 block off Times Square for $99 a night in Feb.

            As for the long vacation deals, I am more weary of those.

  • Ron Ablang says:

    I have bought a few deals to places I frequent, but most of the deals I did buy on were places that I wanted to try out (once I had looked at the deal).

    I do agree that checking all these emails are time-consuming. It depends on what you want to get out of it. I don’t want to miss a potentially good deal so I stay subscribed to most of them.

    I’m subscribed to probably at least 10 different services daily.

  • Melissa H. says:

    Most of the Groupon/LivingSocial/Google Offers emails that I get go straight to my junk mail, so I only check these deals occasionally…

    Like you said, when ‘good’ deals go on sale, (Amazon, Starbucks, Whole Foods), everyone already knows about them so it’s not like you needed the email anyway…

    That said, I’ve bought a couple services from Groupon/LS/GO and I haven’t had a “bad” experience at any of them… in fact, I found a lovely lady for nails that I use regularly now. That said, my other experiences have been “so-so” and it’s definitely because of the clientele… they make the owners and employees jobs living hells!

  • Susan says:

    First, I have to say that I religiously read (and enjoy) all the articles on this website, but I found this one completely outrageous! I whole heartedly disagree with your sentiment in this piece. For starters, if you hate reading each and every single discount notification email, why not sign up for sites that aggregate them, like yipit.com? Yipit collects all the local deals in your area and only includes the categories of your choice. One email to read per day. Tailored to you. Simple and easy. Second, perhaps because I live in a large city, I have more options, but I find the deals on these sites FANTASTIC! I’m introduced to things I never even knew existed in my city, and even better, I can experience them at a discount! Third, I would have to say that I’ve become a repeat customer at about 40% of the places that I’ve purchased deals from, many of them small businesses trying to make it in this big world. I think you are highly underestimating how difficult it is for small businesses to succeed in today’s day and age.

    All in all, I wouldn’t give up on discount sites just yet! And hey, some of us may prefer the excessive manicure and spa treatment specials :)

  • melissa says:

    It must be different in this area. Most of the daily deals are for restaurants in town that EVERYONE loves. There is a local place that is known nationwide (inspired a band album) that offers $9 for $20 very regularly. I buy quite a few at a time and then my hubby and I have a great lunch or dinner for $9. It doesn’t take very long for me to skim the titles on the emails and I just read all the mail I want to then select all unread and hit delete. No time at all.

  • Leah says:

    I recently unsubscribed from all of those daily deal sites too! I bought a couple of things early on that I used and liked, but I tapered off my usage recently due to ennui. If I really want to work with a business, I feel good about voting with my dollars and giving them the full amount.

  • Allen says:

    I noticed when I first subscribed (that lasted maybe 3 months 2 years ago) that the “value” was completely exaggerated. One time Groupon had a Zoom whitening for $199 and the sponsored business claimed a $600 value. When I called the business a week later, with no mention of Groupon, I was told the same service being advertised on Groupon was $275.
    When I emailed Groupon regarding this, their reply was that they don’t verify business’ claims, and I get that to a degree, but just be careful when things advertise “50% off.” Too many people thoughtlessly purchase without even bothering to check out the business’ website, location or its competitors to verify what they’re getting or how much they’d normally spend.
    Bottom line, there are some pretty smart people in the financial industry, and they’re all telling you Groupon is hype($31 IPO, now at $12). Also read into how the SEC has been investigating GRPN’s accounting practices. Hmmm…

  • MoneySmartGuides says:

    I think there was an article I read that stated that most businesses that use those sites for deals never end up making money in the end. They only attract customers that are looking for a great deal. So the business loses money and the customer is a one-time shopper because they are conditioned to that deal. When the business no longer offers it, they move on, meaning they are not loyal customers to begin with. So what’s the point of attracting them in the first place?

    I think this is starting to become the norm as Groupon is providing less and less information on their business to investors and analysts.

  • Lindsey says:

    I had 2 or 3 subscriptions back a year ago when it was introduced to my market. I figured it might be a good way to find local places I’d never heard of. Instead, it was mostly franchises and chains. I think I bought a total of two before getting sick of deleting the emails. My favorite deal was for a new restaurant in town…we went back several times because it was so good! Needless to say, I cancelled the subscriptions and no longer feel overwhelmed by the constant emails.

  • smmancy says:

    I believe the value or lack of value comes entirely from how you use the site.

    If you end up buying things you wouldnt normally, you’re adding cost to your life – even if it’s less cost than it would cost without the deal.

    If you are able to use a groupon to lower the cost of things you would do normally, then you win. I live in manhattan and am constantly eating out – if i can use a ‘Groupon Now’ opposed to hitting up my normal spot, I do save money.

    Also, props to the person who pointed out yipit.

  • Jacquelin says:

    I ALWAYS check Yelp. That website has saved me so much money! The only good offer I found was a discount on fandango movie tickets. I love going to the movies. It was 5 dollars for a ticket and you could buy two. So I bought two and they only gave me one! When I called and complained they said that I had a made a mistake and it’s all on me. I asked to be unsubscribed from them, and they told me if I unsuscribed I would have my amazon account deleted including the fact that I have amazon prime!

    90 percent of the buisnesses selling groupons near me won’t make an appointment if they hear you have a groupon or they find some glitch. They make it so you can’t schedule your appointment until after the groupon expires and then only the money you pay into it is worth anything and you end up paying full price. One livingsocial I saw for a car detailing service wouldn’t honor his groupon cause he lived on a hill. Seriously? He said it was a hazard to his employees health? Getting a workout is a hazard?

    I just wonder if they don’t want to take the groupon or the livingsocial coupon then why are those same companies the ones you see on there over and over and over again!?

    I also don’t think they are losing that much money because they do tend to jack up the price. ALOT. So I bet they still make a slight profit.

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