When I first heard about Groupon and Living social deals,
I must admit, I was pretty excited. I think my first Groupon deal was a dinner
for 2, 50% off. Since then, I have
definitely participated in more (some of which have definitely been left by the
waste side, as I have either forgotten about them or never got around to using
them before the expiration date).
Fortunately (or unfortunately), my inbox is never lacking
an opportunity to prove that I really do know how to waste money but trying out
another Groupon or Living Social Deal. At
any time, I can look at my email and see a plethora of emails from Groupon, Living
Social, etc.
Interestingly enough, after reading the below article, (http://www.nytimes.com/2012/08/18/technology/merchants-and-shoppers-sour-on-daily-deal-sites-like-groupon.html?ref=technology),
I realize that I’m not alone in this feeling – and it’s not just shoppers. Merchants,
as well, have not only not seen beneficial impacts of these deals, but they
actually have been hurt in some cases. For instance, some merchants have lost
money on their deals – and it’s not necessarily a price of building a
relationship with a new customer – these deals attract customers (generally) who
will not pay regular price for whatever it is they have bought the deal for.
1 comment:
It doesn't surprise me that daily deals have played out. The quality of deals has decreased and its clear that the market is completely saturated. What I don't understand is why Groupon didn't see this as the future. I suppose they imagined that their mobile deals would take off. But the truth is, the only competitive advantage they have is relationships with merchants. Anyone can create a coupon app. And users have no reason to choose one coupon app over another. Groupon instituted no switching costs and rather than consolidate relationships with merchants, gouged them instead. How they passed up a 9bil offer from Google blows my mind.
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