Will Groupon Be The Next Great Comeback?

SeekingAlpha.com ^ | Scott Ryan

[publius321]

"...The timed sales aspect is an impetus to get consumers to act more quickly but that alone is not what makes Groupon successful. It is a necessity more than anything and not the reason why consumers are there in the first place. What I believe is the key to Groupon's success is that many consumers, myself included like ..." (continued)

[Cowboy Bob]

I don’t know whay sane business owner would get tangled up in Groupon. They contacted my company. What they proposed sucked.

[publius321]

What business are you in and what did they propose?

[Cowboy Bob]

It is educational services. Basically you are suggested to offer a course (3-6 months) at 60% off. Of the remaining 40%, you get 10% and Groupon get 30% (i.e, 75% of the money coming in goes to Groupon).

It's promoted as a means of advertising, but I know others who did it. When the course ended, the students moved on to another school. So, basically you work for free with no long term returns.

Groupon didn't want us to so a short course, or a one-time discount.

There is a type of person that is attracted to Groupon - they are looking for the cheapest price, and has no brand loyalty. When the special deals end with Groupon, they move on to another company.

My wife discovered Groupon last summer. She has used it a few times, and it was always a one shot deal. Never went back to the same shop or salon because there was always a new shop offering a deal.

Another problem with using Groupon as "advertisement" is that only people who go to Groupon see the deals, not the general public. So, in effect, when you advertise on Groupon you are "preaching to the choir" in that you are pitching deals to Groupon junkies.

[publius321]

Thanks Bob. That is interesting feedback. It’s probably better suited to food & possibly entertainment.

[discostu]

No, too much competition, and too many hassles on their “deals”.

[shibumi]

A message to you.

From someone who cares.

[109ACS]

Another reason to hate Groupon:

Just another 2nd Amendment leftist clowns.

http://www.huffingtonpost.com/2013/01/22/groupon-gun-deals_n_2527168.html

[thackney]

We ride at a stables that uses Groupon to attract new riders.

What the stables offers is a level of stables with rodeo training that simply is not available anywhere else in the greater Houston area. (Low cost stables and intense rodeo only type training, plus lots of work to keep cost down)

Groupon works great for him because it attracks folks who were not involved with this type of riding. Most of his business comes from long term repeat business. Most of the folks that show up a time or two don’t come back; it isn’t an easy hobby and he isn’t an easy instructor.

For him it is cheap advertising. For us it was the reason we gave him a try.

[thackney]

Groupon still carries gun related items.

http://www.groupon.com/deals/spring-guns-and-ammo-4

http://www.groupon.com/deals/the-arms-room-2

http://www.groupon.com/deals/clay-mound-sporting-center

[willyd]

you have nailed the concept exactly. Restaurants experience the same issue. this is an obvious flaw to anyone that examines it closely...yet businesses like this continue to get funding. It is simply amazing.

I saw on another forum where some investor was bragging how software companies don’t even bother to do business plans any more (because no one reads them anyway).

Then they get to the end and go public because surprise surprise no one wants to click on an add on Facebook OR deal hawks who will only buy a meal at 60% aren’t going to turn into repeat customers for a restaurant through Groupon.... etc.

[thackney]

I think the groupon model is a better choice for those selling something unique without a lot of competition. I see it as ways to try something we might otherwise not consider.

[thackney]

I think the groupon model is a better choice for those selling something unique without a lot of competition. I see it as ways to try something we might otherwise not consider.