I discovered “group deals” in 2010 and immediately subscribed to a few popular websites, such as Groupon, LivingSocial and TeamBuy. Soon, there were so many group deal websites that I resorted to an aggregator that delivered the best deals directly to my mailbox.
In spring 2011, I was wondering whether group coupons were a bitter or sweet deal.
And here we are in 2013: I completely stopped buying group deals. I guess I answered my own question… and here is the rationale behind my decision.
There are no more local offers
Most of these group coupon websites started by advertising local deals and businesses. For instance, you could buy discount tickets for a popular local attraction, test a new restaurant in the neighbourhood or try a new hair salon. These days, most deals in Ottawa seem to be for generic products—accessories, jewellery, etc.—from foreign manufacturers. Why would I want to buy generic made-in-China crap I can get anywhere?
The value of the deal can be grossly overestimated
Group deals are supposed to offer buyers a substantial discount on products or services, but it’s just too easy to overestimate their value in the first place. I mean, I have seen haircut packages “valued” at $700. Yeah, right. I value this article at 2 million dollars, doesn’t mean it is worth that much (I’d take a million!).
Most of the offers are scammy
I’m tired of seeing offers from unknown websites such as buymyproduct.ca (yes, I made that up) that may or may not be reliable. But overall, I’m tired of seeing deals for teeth whitening treatments, weight-loss programs or PowerBalance wristbands (yes, the product is a scam—shocking, I know).
Reviews are hard to come by
A lot of local businesses offering deals are new or not that popular (which is usually why they advertise on group deals in the first place), and it’s hard to find reviews on them, including on Yelp or Google Reviews. As a customer, you are taking a risk.
It’s always the same (terrible) businesses selling group deals
And that brings me to this important point: it seems that some businesses (typically haircut or tanning salons in Ottawa) are constantly running deals with various websites. That makes me very suspicious because group deals are supposed to be a one-time thing—not a business plan considering the profit margin after the deal is supposedly very low. So either the product or service is overvalued in the first place, or the business is trying to get cash quickly to stay afloat.
Businesses don’t always honour the deal
See the point above! Some businesses go bankrupt because they sold too many deals on too many websites and can’t honour them, some were never to honour the deal and were just looking for quick cash. In Ottawa, the story of Aubrey’s Meats is sadly famous in Ottawa—this small business sold thousands of coupons and never honoured them.
You can get sub-par service
The deals I was mostly looking for back when I was browsing the offers daily were typically spa services, such as massages and pedicures. I like being pampered and deals were a way for me to discover new places and try new services for an affordable price. I had a great experience with my first Groupon, at Elgin Massage Therapy Clinic (I am still a customer two years later!). But I often received subpar service just because I was using a coupon. Spas that I would never go back to include New-U Body Bar, Essence Massage & Spa and Peveecka Spa—service was poor, the owners complained that they were losing money with the deal (not my fault!) and rushed me in and out. Meh. Not impressed.
Scheduling appointments is hell
Because so many people buy deals, scheduling an appointment can be a real headache. I had to wait months to get an available slot in some cases, which is kind of annoying.
Businesses try to upsell
When businesses feel they are losing money with the deal, they try to upsell. I get it, it’s part of the game, but some places (including New-U Body Bar) were very pushy. Some businesses just make up new terms and conditions as well, i.e. no appointment between whatever time and whatever time, which is annoying.
Deal websites have terrible customer service
Finally, I do not trust deal websites anymore after an issue I had with TeamBuy and their deal for a massage at Glebe Fitness. The first appointment I made was cancelled, and so was the second one. Both times, I only learned about the cancellation at the last minute, upon arriving. Scheduling a third appointment was impossible: the place was booked solid until December 2012. Frankly, I doubt the business wanted to honour the voucher. I emailed TeamBuy and explained the situation. Three emails and several weeks later, I finally received a very curt email, in which TeamBuy offered me credit towards a future deal. Considering how slow their reply was, and how bad the attitude was, I declined and asked for a refund—I don’t want to use their service ever again. TeamBuy never emailed back. I eventually resorted to doing a chargeback and my bank refunded me the money (good job CIBC!).
How about you? Still buying group deals? Did you have any issues with them?
I’ve also been trying Groupon but I’ve been very picky about it, and the appointments are always a pain to get. There aren’t too many deals in the Poitiers area so it’s a little less overwhelming than somewhere like Paris. Because there are so few that are really local, I sometimes end up getting the same ones as other people I know, which is kind of fun.
But there’ve been a lot of articles published recently about how Groupon’s business model was unsustainable, and good businesses don’t want any more to do with it since it was so bad for them—hence the newer trend of “deals” about discounted merchandise. It looks like it’s on its way out, which means fewer massages for me, but then, I was never spending that money on things I really needed anyway!
You are right. I read some of the articles and while I have no sympathy for merchants who use the system, the Groupon model doesn’t seem to work for small businesses who are taken advantage of.
I never trusted those websites, a bit too scammy for my taste. I only buy discounted theatre or Disney tickets on Vente Privée in France.
Never heard of Vente privée! Does it work on the same model?
I totally agree with you on this. It’s a shame, because it was an awesome concept when it first came out. Especially with regards to how it promoted local business – I loved that part. In the past year, I’ve encountered more problems REDEEMING group deals than actually having a successful time with them. I’ve pretty much ditched them too for 2013.
Milsters
I know, I loved the concept too! But there are just too many deal websites these days and some are really scammy.
I never got into the habit of checking out the Groupon deals. I did subscribe to the emails, but after checking out what they were offering, I quickly realized that the products aren’t really things I wanted nor needed, and so they just crowded my Inbox. Perhaps, it helped that Buffalo wasn’t a city big enough to have many “local” businesses wanting to jumpstart their business by offering these deals.
That’s the smart thing to do actually: you didn’t waste money on products or services you wouldn’t have used anyway!
I’m with you. I unsubscribed to living social a couple of weeks ago because of the sheer number of emails they sent me plus the fact that most of the offers were from places hundreds of miles away and offered a load of rubbish. I’m sure there were the odd offers that were legit but I suspect most of them weren’t. I’d rather pay full price than risk a scam any day!
Oh yes, these far away places…! Some “Ottawa” deals were actually in other small towns around. Good thing I always check the location before buying, I almost got trapped into of these deals once!
Oh I didnt know it is popular there in Canada, I know my Daughters shopped online very often and Groupon is one of them besides QOO I think. I will ask her to be careful and check on the deals as well.
I didn’t know it existed in S’pore! I guess it depends on the country, some local deals may be good but tell her to keep an eye open for fraud.
I agree with most of your points but I keep buying some groupe deals when it suits my need. Like hair dresser recently because pay over 100$ for higliths and a cut, no thank you, but 40$ okay. Before, I bought more restaurants deals but it’s been a while since there was any place that I was interested in.
And once I couldn’t get an apointment for a massage that my boyfriend bought so I wrote to Groupon and got reimburse but clearly if there is a next time I will call for an apointment as soon as I got the deal! Oh and last thing, I think it’s very interesting for laser epilation and that one I will buy one day…
I think you have more offers in Montreal, bigger city and all. That said, be careful with the laser epilation ones, I read about a few scams in Montreal with those deals on the Red Flag Deals forum.
I was always quite suspicious of these so-called deals after comparing prices and offers. In the end, I have only bought two (cruise in Toronto harbour for me and a visiting friend, and a one-year Bixi membership for $47 which was less than half price), redeemed one gift from a client, then unsubscribed.
There is such a thing as “too good to be true”.
I’ve heard awful feedback from a Toronto harbour cruise… did you enjoy it?
GroupOn should have realized all this before their IPO…
great post Mamma!
Another point is that the deals are usually for things/services that we don’t really need and most people buy it just because it’s a supposedly “good deal” and offers “value”.
That’s a great point. You aren’t saving money if you didn’t need the deal in the first place.
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