'Bought a spa day from Groupon or others? Did you get it?' blog discussion

So far, all the deals that I have bought have gone smoothly. Personally, I think it is a great idea and I have bought many restaurant deals in the past.

However, I have come across many stories where the deal has not gone quite to plan. In most of these cases, popularity of the deal has been the problem. I think there needs to be clear communication between the business (especially small businesses) and the group buying website, especially with regards to the number of deals being purchased.

I agree with your 'code of conduct' points. I think the idea of capping deals is one of the most important points you raised. Sadly, I don't think many of these websites would adhere to this point. They would much rather make £5 per deal on 3000 sales than £5 per deal on 200 sales. After the deal has finished, they'll move on to their next offer. I don't think the likes of Groupon, KGB, Crowdity etc. care whether customers are having problems when trying to redeem their voucher.

My advice? Be careful when buying these deals, but there are some great bargains to be had!

Always go on the business' website and look at their prices. You may notice that the RRP on the group buying website is overinflated and that there are special offers. This gives you a false indication of how much you're saving.

If it's a small business in your local area, then buy the deal later in the evening (if you can). I've come across this many times. For example, I see a deal in the morning that I want to purchase (let's say a meal for 2 at a restaurant). I notice that there's only 2 months to redeem it and that the voucher is not valid on Friday and Saturday evenings. I've noticed that 200+ deals have already been bought. Therefore, I wait 'til the evening. I log on at 9pm to see that 3000+ deals have been purchased! How on earth will 3000+ deals be redeemed within 50 days or so? i.e. 6000+ people in a small restaurant? And don't forget the ordinary customers! In the end, for obvious reasons, I will pass on this particular deal and wait for one that can logistically be redeemed.

I also read an interesting post by a small business on the grabbit thread recently who took part in a KGB deal. This is an example of how a deal can go wrong. It also gives an interesting insight into the operations of a group buying website. Here's the post:

http://forums.moneysavingexpert.com/showthread.php?p=45398474&highlight=#post45398474

EDIT: Just remembered another piece of advice. I may get shot down for this, but I'll say it anyway.

The way I understand, is that the majority of these deals get split 50/50 between the group buying website and the business. If there's a deal you're interested in and it's a small, local business, then it may be worth ringing them up on the day of the deal, as you may be able to get a better price. If the likes of Groupon are offering a £30 deal, £15 will go to Groupon and £15 will to go the business. When I enquired about a deal once, I was offered the very same deal for £20. I saved a tenner and the business gained a fiver (plus they didn't have to wait several weeks for the money from Groupon).

Martin, i negotiated a deal with Groupon for my former employer. Groupon only pay the business's cut of the voucher value (usually 50% less VAT) when the customer redeems the voucher. So if customers dont redeem Groupon keeps the full value. The Groupon operative I dealt with told me "to be honest, that's how we make our money"! So I think it is quite deliberate. Other deal sites (e.g. Living Social) do it differently as I understand, but the whole thing is pretty cynical

Gh

I bought three vouchers from Groupon for a local holiday rental company. Two as gifts and one for my own family. The deal was for a discounted price for two nights on a choice of several cottages and each voucher cost about£100. When we tried to book we were told that all cottages were fully booked for six months-the middle of the winter was when they were next free-we had purchased the vouchers in April. The company told us that they had authorised Groupon to sell approx 200 deals but Groupon had in fact sold almost 800!!!
We were very disappointed as we were looking forward to our break with our three kids. We can understand the company are overrun with the deals they are trying to accommodate and also the money they are losing in the process by trying to honour the new clients. I have since been told by someone in the industry that althoub Groupon say they will put a 'cap' on the amount of deals sold, they actually in practice do not as they earn their money every time they sell a deal. They even hold all the payments until it is redeemed by themcustomer so the small business does not even receive our payment immediately. I have friends who have had similar experiences and I will not be using Groupon again.

Groupon were very quick to refund my voucher for a spa deal where I could not get an answer by telephone and the website was inactive. Groupon seemed genuinely not aware before my call that there was an issue, so it is possible the spa had only recently had issues - it was near the end of the voucher validity.
I certainly think there should be regulations, especailly about capping, and availablity, but it is unrealistic to imagine that companies like Groupon are in this business primarily for the benefit of the customer. Good customer service is important and essential to the long-term health of the business, but people go into business to make money!

You know the worst part - if the customer doesn't redeem the voucher groupon keep the money and not the retailer! The retailer only gets the money as they redeem each voucher as its used! No wonder groupon is doing so well!!