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The worst users come from referral programs, free trials, coupons

andrewchen.com

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Re: The worst users come from referral programs, free trials, coupons

#71

Post by pxx »

TheCaptain4815 wrote: post #41
steveBK123 wrote: post #36

Thinking more on this, I have a group of friends who partake in these types of deals. They are arguably a leading indicator of business models that are going to fail. Why? Because they will cycle through every single deal and never sign up. Every single one of them cycled through all the meal kit trial discounts during the ZIRP era, without ever signing up for one (it's free food dude). If you think I am kidding, go…

I did the same with the free money those gambling sites were all giving away. Stayed disciplined and made around $800

Ah with gambling the business model is very different. You just need to be fishing for whales. Somebody can't be a 1000x or even 100x customer on Uber compared to the median. Somebody can easily be a 1000x gambler

Re: The worst users come from referral programs, free trials, coupons

#72

Post by yCombLinks »

red_admiral wrote: post #30
forsyth2024 wrote: post #20

For the most part, it doesn’t sound like these “bad” customers are doing anything illegal or in violation of TOS. They’re just exploiting offerings for something they wouldn’t normally spend any money on. To be surprised that they don’t stick around long or spend as much as non-incentivized customers shouldn’t come as a surprise to anyone and shouldn’t be seen as some kind of failing. They would not normally have use…

For "bad", read "poor".

Nah, there is more than 1 bucket here. There are the poor people, who actually need the coupon to afford it, but they are not usually the problem. The problem is the stingy people. They'll complain the most, try to get refunds the most etc. Blah blah blah, if they can get it they should. Whatever, I'd rather not have their business, I'll take the 80% of people that are happy.

Re: The worst users come from referral programs, free trials, coupons

#73

Post by dazc »

rchaud wrote: post #51
dazc wrote: post #6

Recent example, a piece of furniture costing over £3k and I can get 10% off if I sign-up to their newsletter. As someone who works in retail marketing, this is a guaranteed way to ensure I don't spend a penny in your store.

Doesn't the 10% off apply to the shopping cart total? I take it not everything in the store costs £3k? Not sure why this would turn anybody off. Plenty of stores do this.

Yes, plenty of stores do this and it doesn't turn off that many people.

Think of an online retailer that has been around a while and is solvent though and I'll bet they don't do stuff like this.

Re: The worst users come from referral programs, free trials, coupons

#74

Post by treffer »

red_admiral wrote: post #29

The kind of people who ran coupon schemes in the pre-internet days could have told you this. Back in the day, coupon schemes were things like you had to physically cut out and mail in vouchers from newspapers or magazines, and you got a discount on something like groceries in return. The point of this was market segmentation: you want to get people who (1) otherwise wouldn't buy your product, or at least not as much…

It becomes more funny once you shift online. Basically every checkout has a "coupon" field.

Now you look for coupons, and some coupon aggregator of doubtful quality pops up.

You find something that works. Or give up. Done.

The coupon sites are usually of doubtful quality because .... Basically all affiliate networks forbid it. It's also the reason why "last click" attribution is horribly broken.

Funnily enough it's now mostly magazins & newspapers that run these coupon sites in Germany.

Re: The worst users come from referral programs, free trials, coupons

#75

Post by ipaddr »

electriclove wrote: post #57
FredPret wrote: post #46

Earlier quoted context omitted.

Another answer is “someone who would slog through some effort to get a tiny bit of a better deal” and these people are definitely worse customers, rich or poor.

Why the downvotes / disagreement? “People using coupons -> worse customers” makes sense to me. The shop isn’t getting more money from these customers.

Not true. A dollar off coupon will encourage purchasing otherwise ignored products.

I buy toothpaste. A dollar off coupon will encourage another brand purchase to a more expensive product that may get repeated.

The shop may get addition money by having me buy other items to save me the time of multiple store visits.

There is a reason why each week a different item goes on sale. That loss leader leads to more purchases

Re: The worst users come from referral programs, free trials, coupons

#76

Post by eightysixfour »

I spent some time in UX consulting and I started to notice a pattern that surprised me a bit - having really slick UX (if that isn't your key selling point!) in a very early product seemed to be a bit of an anti-pattern for long-term success. My hypothesis is that there are a group of users who will sign up for anything and "play with it" if it is easy enough and slick enough, but that doesn't make them good customers, much like the customers Andrew is talking about.

Re: The worst users come from referral programs, free trials, coupons

#77

Post by throwaway8877 »

electriclove wrote: post #57
FredPret wrote: post #46

Earlier quoted context omitted.

Another answer is “someone who would slog through some effort to get a tiny bit of a better deal” and these people are definitely worse customers, rich or poor.

Why the downvotes / disagreement? “People using coupons -> worse customers” makes sense to me. The shop isn’t getting more money from these customers.

Careful there. People also may also not feel good about being taken advantage off. They may also not feel good about valued less than a little more paying people.

Re: The worst users come from referral programs, free trials, coupons

#78

Post by ipaddr »

booleandilemma wrote: post #60
szundi wrote: post #50

Earlier quoted context omitted.

I am a multimillionaire and love coupons and good value

In your previous comment you said you wrote "about 1000 games" in your school years. I wonder if that was a lie too? :) https://news.ycombinator.com/item?id=39235575

Why would making 1,000 games (that can be translated to many) that lead to a game startup and successful exit would call you to question if the parent was a millionaire.

Successful exits usually are worth millions.

Re: The worst users come from referral programs, free trials, coupons

#79

Post by dylan604 »

rib3ye wrote: post #59
steveBK123 wrote: post #36

Thinking more on this, I have a group of friends who partake in these types of deals. They are arguably a leading indicator of business models that are going to fail. Why? Because they will cycle through every single deal and never sign up. Every single one of them cycled through all the meal kit trial discounts during the ZIRP era, without ever signing up for one (it's free food dude). If you think I am kidding, go…

I frequently use 50% off discounts to buy square pie guys pizza. Will I buy that pizza at full price? _probably_ not, but I will tell everyone that it’s amazing because is it. So it’s a $12 review, right? Compared to a $1k-$5k /video influencer, isn’t that a deal? I’ve even spammed their name in this comment. Disclaimer: I know nothing about marketing economics

> So it’s a $12 review, right?

> Compared to a $1k-$5k /video influencer, isn’t that a deal?

I mean, that totally depends on the "influencer" right? How many people will you actually talk to where you've spent $12? How many people will hear about it from the influencer? If they have 1M subs and get $5k, that's half a cent per view.

Sometimes, simple arithmetic can disprove ridiculous viewpoints. Now, it's just a matter if you're one of the types of people that will hold on to ridiculousness in the face of evidence.

Re: The worst users come from referral programs, free trials, coupons

#80

Post by warner25 »

steveBK123 wrote: post #45
warner25 wrote: post #35

Earlier quoted context omitted.

I agree with you. I've seen other people write about this before and it seems that the people talking about it are people who happen to make a lot more money than the average person. Good for them, but that doesn't mean that people who make less money just have the wrong mindset or some kind of moral failing. I apparently have gone from an extreme "scarcity mindset," when I was in my 20s with questionable job securit…

There's nothing wrong with either mindset, most people are incapable of doing both at once. You can have "scarcity mindset" and be rich. Of course someone with scarcity mindset grows savings over time because they have scarcity mindset! They are good at saving your money! But this part: > It's still moderate because I'm a government employee with a relatively low ceiling on what I can make; not much room for growth.…

I see where you're coming from regarding "[settling] into that job & [accepting] that life path" as a government employee. I thought about that after I wrote it myself. The alternative, however, strikes me as taking imprudent risks, if one is supporting a family, and having a work-life balance that one's family wouldn't appreciate (mine already thinks that I work too much). You're right on the mark: my savings rate, and government pension, should result in early retirement. I think I'm interested in having more time, not more money. I'm really content with consuming relatively little.

Maybe it's the "scarcity" and "growth" parts of the terminology that I take issue with, but I'm not sure what better descriptive terms would be. Edited to add: The more verbose descriptions that you wrote in your other comment make sense... "I'm going to make as much money as possible" vs "I'm going to spend as little money as possible"

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