41–50 of 56 posts
Just out of curiosity: what do you think the actual usage rate is for these groupon/coupons? I'm sure it's way way higher than a coupon printed in a paper or offered online, but there has to be a certain % that don't get (or forget) to use the coupon before the expiration date and the business benefits outright.
Just out of curiosity: what do you think the actual usage rate is for these groupon/coupons? I'm sure it's way way higher than a coupon printed in a paper or offered online, but there has to be a certain % that don't get (or forget) to use the coupon before the expiration date and the business benefits outright.
Don't most of the groupons have a policy that if you don't use it by the expiration date, you can still redeem it at the price you originally paid for it?
It was sent only a few days after the advertisement, and the writer is gushing about web stats. Given that Posie's didn't seem to realize the mistake they made until the Groupons coming in started to drain at their finances, this doesn't really prove anything.
The writer is excited about the spike in traffic and assumes that the "web-savvy" customer will be good for business, speculating about viral, positive word of mouth. But none of that could possibly have happened in three days.
This customer hasn't been satisfied by the effects of Groupon. They've bought into the marketing of Groupon. Now, maybe they'll be satisfied once they see how those 505 coupons they sold turn out, but theres no way to know at the time of writing.
From PosiesCafe blog: "When I talked to Lucinda today, she asked if there was a cap on how many were sold to help protect the business from too much loss, and the simple answer is, no. When you sign up for Groupon, you are agreeing to sell as many as get sold… and why would Groupon want it any other way? They get half of the earnings." From Groublogpon: "Also, to clarify one important point: it has always been Groupo…
Smart of them to respond quickly and swiftly, but the core issue of this specific case wasn't addressed. A naive business owner was aggressively sold into a plan that wasn't sustainable for their business, and by all accounts wasn't aware of the cap system which Andrew says "has always been Groupon policy to allow merchants" to have. So the PR responses read wells to people who have already decided Groupon did no wro…
However, I read their entire post as a backhanded criticism of the business acumen of the owner of Posie's Cafe. "97% of businesses would use Groupon again... Groupon is a great resource for solid businesses... this guy sold 10,000 bagels no problem because he was prepared".
I am very much pro free market, so it is hard to me to fault Groupon for penning the deal (beyond a few reservations based on long term business). But it is easy for me to fault Groupon for what I read as a thinly veiled attack on the owner of Posie's.
Smart of them to respond quickly and swiftly, but the core issue of this specific case wasn't addressed. A naive business owner was aggressively sold into a plan that wasn't sustainable for their business, and by all accounts wasn't aware of the cap system which Andrew says "has always been Groupon policy to allow merchants" to have. So the PR responses read wells to people who have already decided Groupon did no wro…
"Traditionally, the biggest problem for most small businesses is getting customers in the door."
Actually, the primary concern of most small businesses is keeping the doors open.
Once the doors are open retailers have two things they need to maintain:
1. The number of customers
2. The amount of money the average customer spends
Groupon's terms are too greedy and it will be their downfall unless they change it. It is way too easy for someone to come behind them and just offer better terms to the businesses and run Groupon out of town (without businesses Groupon has no benefit).
The company offering the best deals from the most desirable places will win the daily coupon market.
First of all, she acknowledges that it was her fault for not doing the math.
However, what she learned from the experience (besides losing $8,000) is that Groupon customers are worthless. They are cheap (duh) and they don't come back -- probably off to the next Groupon deal. [1]
These are not people you want in your restaurant. You want people who will pay full price and come back. Especially at a coffee shop, where there is not a lot of room to upsell someone who has $13 worth of store credit!
This is going to make it clear to small restaurants that Groupon works for places with fixed costs that can use price discrimination to get people in the door, but not well for them.
In fact, it gives me a startup idea: the OPPOSITE of Groupon. People pay extra for a limited number of guaranteed spots at exclusive establishments. Want dinner on Friday night at the hottest restaurant in town? We've got it, but it's going to cost you 25% more.
[1] I attended an event where 4 people bought $30 Groupons to a local bar for $10. They invited everyone they knew for Sunday Happy Hour and bought 120 $1 mimosas and bloody marys. We all ordered food, but those $1 drinks were already loss leaders. Assuming a 50% Groupon cut, the bar made $0.15 on each one. Did the food orders make up for that? http://www.flickr.com/photos/lukefrancl/4897720841/
Just out of curiosity: what do you think the actual usage rate is for these groupon/coupons? I'm sure it's way way higher than a coupon printed in a paper or offered online, but there has to be a certain % that don't get (or forget) to use the coupon before the expiration date and the business benefits outright.
Earlier quoted context omitted.
I'm gonna sound cynical here, but why do you think that? People in business lie all the time to cover their butts or prevent embarrassment.
Well for one thing, it would be easy to verify whether or not Groupon is lying here, by talking to other companies that have used Groupon. If they are caught lying, it will hurt their reputation, especially when they are in reputation-protecting mode. They could be lying, but it would be a very bad business decision.