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Groupon Is Laying Off 1,100, Shutters Operations in 7 Countries

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Re: Groupon Is Laying Off 1,100, Shutters Operations in 7 Countries

#171

Post by VLM »

somedudethere wrote: post #54
bane wrote: post #16

I'll be honest, I know Groupon and its ilk are terrible business, but as a user of the service I've had lots of fun exploring activities and restaurants that I literally would never have bothered with or known about. In the last few weeks I've taken a Scuba lesson, a Horse Riding lesson, an intro to art class, found a couple new amazing sandwich shops. I took an amazing trip to Ireland for something like 50% off the…

My experience with groupon involves two different times. Both times involved me calling the business and being immediately asked if I had a Groupon. I don't think this was a groupon only number, but the business pretty much runs entirely off Groupon. One was to have my carpets cleaned when they arrived they said the Groupon was for using water only (it wasn't steam cleaning just regular) and I had to pay extra to act…

I've seen the same deal locally with car detailing. You can walk in off the street and pay $100 or get 50% off regular $200 on Groupon. Or groupon car detailing doesn't include (long list here) so basically you just overpaid for a car wash.

Re: Groupon Is Laying Off 1,100, Shutters Operations in 7 Countries

#172

Post by jgalt212 »

some quotes from the snake oil salesman

Groupon May Be Fastest-Growing Company Ever

http://www.cnbc.com/id/40454493

Groupon is going to be wildly profitable.

-Eric Lefkofsky

http://www.bloomberg.com/news/articles/2011-06-05/groupon-ch...

Is Andrew Mason still a YC part-time partner?

Re: Groupon Is Laying Off 1,100, Shutters Operations in 7 Countries

#173

Post by theworstshill »

Half of Groupon's failure is the email spam model, another half is the business partners. If you signed up for a service where you give discounts and got any less than a shining smiling face when I come in with one, guess what - I'm not coming back to you. Groupon should have screened businesses the same way Apple screens apps, very carefully.

Re: Groupon Is Laying Off 1,100, Shutters Operations in 7 Countries

#174

Post by georgemcbay »

jacalata wrote: post #113
zck wrote: post #107

Earlier quoted context omitted.

But shouldn't Groupon just be a marketing expense? I'm not saying that the company should be ok losing money all the time, but it's common for companies to spend money to acquire customers. Do you avoid all "new customer" deals? It seems like companies on Groupon, for whatever reason, often offer way more of a discount than they're comfortable with. I wonder why that is.

I think there were a bunch of stories implying that it was because of pressure and misleading reassurances from the Groupon sales people signing them up combined with poor business sense from the small-time owners, in most cases.

I've heard the same, but the company treating Groupon customers badly is still irrational behavior.

The money being lost on the Groupon is a sunk cost, so you've got:

Option A: Lose money on the customer, treat them like second class citizens, probably lose the customer forever, possibly have the customer tell all of his or her friends how bad they think the business is.

Option B: Lose money on the customer, still treat them just as well as any other customer or even better and try to convert them into a repeat customer and/or organic spokesperson for your business, recoup the lost groupon money over time through repeat business.

I can't speak for everyone but I know that if I'm an option B customer, I'm going to be an enthusiastic spokesperson for the business. Getting a great deal and good service early on is a good way to convert me to be a customer of yours for life (early impressions really stick with you, sort of the reasoning behind buying the first round of drinks, you probably don't need to buy another drink all night because you're the cool guy who bought the first round).

So all-in-all, I don't think all the blame of having Groupon customers treated badly (if this even exists as a real thing and isn't a perceived occurrence that isn't statistically a real thing) can be placed with Groupon.

I suspect at least part of it is likely just the fact that a lot of businesses have terrible customer service these days (probably due to a number of factors including low wages, races to the bottom on margins, etc) and as a customer you would have been treated pretty poorly anyway but the groupon thing gives you something to latch onto as far as reasoning it out.

Re: Groupon Is Laying Off 1,100, Shutters Operations in 7 Countries

#175

Post by protonfish »

ceejayoz wrote: post #7

Anyone getting their emails has known it was coming for a long time. They used up all the good places pretty quickly - they got the return customers and didn't need to re-run coupons. Now it's all weight loss scams, online courses "worth" $2k but sold for $20, and even sex toys lately.

It reminds me of the game console crash of '83. It's a great product, but when you gouge your customers you can create a lot of bad feeling that doesn't go away quickly. A company like Groupon could easily be profitable charging businesses a fraction of what they do, but they chose not to. This is the opposite of what most start-ups do (delay profitability until later.) The short-term thinking of overpricing has long-term repercussions for them and any other business that resembles them.

Re: Groupon Is Laying Off 1,100, Shutters Operations in 7 Countries

#176

Post by Zarel »

RyanZAG wrote: post #149
imgabe wrote: post #143

Earlier quoted context omitted.

I'm sure a lot of people do that, but the appropriate etiquette when using a coupon at a restaurant is to tip on the full price. Most adults who frequent restaurants should know that.

You know that most of the world's population doesn't tip at all? Given that, it seems kind of strange to assume everyone just knows the appropriate tipping etiquette without being told when getting the coupon or sitting down. Plus the most active users of groupon are probably doing it to save as much money as possible with coupons. They're unlikely to willingly throw away those savings on massive tips... and from wha…

For the record: Groupon does remind you to tip on the full price when getting the coupon, now.

Re: Groupon Is Laying Off 1,100, Shutters Operations in 7 Countries

#177

Post by Zarel »

coffeedrinker wrote: post #156
tedunangst wrote: post #101

Earlier quoted context omitted.

Based on her likely experience with the previous ten groupon customers, you basically announced "I intend to tip you 25% of what you were expecting."

But rudeness in wait staff is a self-fulfilling prophecy. They treat you poorly so how can they expect a generous tip?

It's less self-fulfilling than you would expect. Research shows that tip amount isn't very affected by the quality of service, but much more affected by the person doing the tipping.

Re: Groupon Is Laying Off 1,100, Shutters Operations in 7 Countries

#178

Post by hnal943 »

sigmar wrote: post #52
bane wrote: post #16

I'll be honest, I know Groupon and its ilk are terrible business, but as a user of the service I've had lots of fun exploring activities and restaurants that I literally would never have bothered with or known about. In the last few weeks I've taken a Scuba lesson, a Horse Riding lesson, an intro to art class, found a couple new amazing sandwich shops. I took an amazing trip to Ireland for something like 50% off the…

I agree with you. Seems like they should have stayed small and been happy with small returns. Any business can throw a 50%-off deal up on their facebook page or website. They weren't adding value by consolidating those deals to one site.

The value they added at first was the viral nature of the deal - you only got the deal if enough people signed up. This prompted people to tell their friends, which created buzz. Once they got large enough, there was never a sense of urgency and that value was decreased.

Re: Groupon Is Laying Off 1,100, Shutters Operations in 7 Countries

#179

Post by kardos »

antidaily wrote: post #3
kardos wrote: post #2

Looks like businesses have collectively realised that groupon is a miserable deal and it's finally caught up with them, after having been running on fumes [1] for a couple years now. [1] http://blog.bodellconsulting.com/2013/03/01/groupon-a-bad-de...

Is it running on fumes? They still have significant revenues and loyal customers and a million sales people.

They don't have a million sales people -_-, 11.8k employees total is a better estimate [1], dropping to 10.7k soon.

Maybe fumes was not the right word. The things they offer as "deals" are fumes. I just loaded the Toronto section, and saw "$179 for $2392 worth of laser hair removal" with >200 sold. I don't believe that the $2392 figure is not grossly inflated. Also "$430 for a $899 iPhone", but then you notice "condition: refurbished".

These things don't come across as credible promotions, but rather the result of someone packaging something up to appear to be a promotion, but it's just a normal price disguised in some way. Perhaps there are some actual promotions on there, but these pseudo-promotions reduce the credibility as a whole. So what's special about groupon again? I can get normal price things anytime/anywhere, and not have to go through the hassle of buying the coupon in a specific time frame, and only be able to use it in a different specific time frame and another dozen restrictions.

[1] http://www.bloomberg.com/research/stocks/snapshot/snapshot.a...

Re: Groupon Is Laying Off 1,100, Shutters Operations in 7 Countries

#180

Post by teraflop »

pearjuice wrote: post #92

So on what contract were these 1100 people employed? 0 hours guaranteed, get in and get paid for the hours you work and your contract can be terminated any day? It always baffles me to see a thousand(s) of people getting laid of with the flick of a finger. That's like an equal amount of people added to the economy unemployed, right now.

I'm guessing you're not from the US? That's pretty much how it works here, except for government or unionized jobs. Most employees, whether hourly or salaried, don't have any kind of employment contract.
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