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Group Coupons: a Bitter or Sweet Deal?

Love (and shop­ping) is in the air, Ottawa, Spring 2011

Unless you spent the last few years in a cave, you prob­a­bly noted the emer­gence of dozens of “group coupon” web­sites: Groupon, Liv­ing­So­cial, Koo­pon, DealFind and many other are prob­a­bly already serv­ing your city. Sim­ply type the name of your city plus “deal” and they will pop up in your search results. Or just look at this blog’s side­bar: Groupon often adver­tises here.

I’m kind of a late adopter and I never really paid much atten­tion to these web­sites until a few months ago, when I noticed Deal Page, a page that aggre­gates all the deals for a given city. I found it was a pretty smart idea because there are sim­ply too many group coupon web­sites on the mar­ket, and each of them requires you to log in to see the deal of the day. Deal Page bypasses all that: a quick glance at the page will show you all the rel­e­vant deals for your city.

I book­marked the page and started check­ing it once in a while. Most offers seemed to be pretty good deals, offer­ing hefty dis­counts on spa pack­ages, meals in trendy restau­rants or yoga/pilate classes. Within the past 6 months, I bought two deals on two dif­fer­ent web­sites, one for a pedicure/manicure and one for a spa package.

First obvi­ous obser­va­tion: these deals do save you money but chances are you will spend more than you intended to. Group coupons encour­age peo­ple to buy “treats”, that is non-essential ser­vices such beauty ser­vices or restau­rant vouch­ers. Chances are you didn’t really need karate classes but you bought a pack­age because it seems like a sweet deal. If you are look­ing for deals to make ends meet at the end of the month, don’t bother. Or check out these 11 Ways to Resist Wast­ing Your Money on Groupon and Other Deal Sites.

So, all’s for the best, in the best of all pos­si­ble worlds? Not accord­ing to some dis­grun­tled busi­nesses and cus­tomers who expe­ri­enced group coupon night­mares.

The num­ber one com­plaint from busi­nesses seems to be that they didn’t know what they were get­ting into. Group coupon busi­ness clients mostly want to spread the word and attract repeat cus­tomers. How­ever, most of them are small busi­nesses and they are not always pre­pared for the poten­tial unex­pected large influx of deal-buyers. In some instance, so many peo­ple buy the deal that it would take the small busi­ness sev­eral years of work­ing full-time to rea­son­ably hon­our them all.

Other busi­nesses report that while they don’t expect to make a profit when offer­ing a deal (the ser­vice or goods are heav­ily dis­counted and social web­sites take a large cut), they have prob­lems just stay­ing afloat. And deal-seekers can be rude, cheat or “for­get” to tip staff mem­bers. Finally, there are appar­ently less repeat cus­tomers than most busi­nesses hoped for. It’s true that as a cus­tomer, I prob­a­bly won’t come back to the spa where I had my mani/pedi: the full price tag of the ser­vice is sim­ply too high.

On the other side, group coupon buy­ers may find that it is dif­fi­cult to sched­ule appoint­ment due to the masses that bought the same deal. For the pedi/mani deal I bought, I was lucky: I called right away and was sched­uled within a week or two. Mind you, that was almost two months ago and I’m will­ing to bet pedi­cures are not the best-selling ser­vice in the dead of the win­ter. I’m sched­uled to use the spa pack­age deal early May—it took almost two months to get an appointment.

Other buy­ers com­plain that they are treated as sub-par cus­tomers because busi­nesses don’t feel they are get­ting their money worth. Scams are start­ing to appear as well. For instance, this Valentine’s Day offer wasn’t such as sweet deal, and a pho­tog­ra­phy deal was recently pulled off after it was revealed the pho­tog­ra­pher stole pic­tures to pro­mote her business.

I will con­tinue to check upcom­ing deals but I’m get­ting really picky—not that I was a big con­sumer before anyway.

Have you ever used a group coupon web­site? Bought a deal? What was your experience?

16 comments

  1. I usu­ally get coupons for things I am going to do any­way, like buy­ing some­one a birth­day present, or get­ting my hair cut. Haven’t had any bad expe­ri­ences yet, but I think that Deal Page you posted may be my down­fall ;-)

    • Do you know any good place for hair­cut BTW? I like your hair and I can’t seem to find a nor­mal place in Ottawa. Styl­ists can be… strange.

  2. I’ve come across them, but things seem a lot more tra­di­tional around here, ie you get a coupon in the news­pa­per and such…
    I’m even use­less with reward cards. The only thing that really works for me is the loy­alty card from the uni­ver­sity cof­fee shop.

    • :lol: Cof­fee, stu­dents’ poi­son of choice!

      I guess North Amer­ica is really a consumer’s soci­ety so these kinds of ini­tia­tives are plenty.

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