Becoming a Groupon Groupie

I have a pretty idyllic Friday evening planned: I'm going to yoga class, and then taking my husband out for dinner. These are both fairly spendy activities for me, but I got a great deal. I've already paid for both my yoga class and my date night with Groupons.

Groupon is the mother of all daily deal sites, with a rapidly growing number of competitors. The concept is simple: A product or service is offered at a discounted rate, but the deal only goes through if enough people buy it. The businesses make out — in theory — on volume, while the buyers score some great deals.

Sounds almost too good to be true, right? And it's just that — almost too good to be true.

A Groupon Groupie
When Groupon works, it works great. That yoga class I mentioned? I got 50% off a month-long membership at the local studio right around the corner from my house. I was going to buy that membership anyway, and the Groupon happened to be fortuitously timed for two weeks before I wanted to use it. I snapped it up. My date-night Groupon is a similar deep discount for dinner at my husband's favorite restaurant. We go there all for all our special dates, like anniversaries and birthdays. Buying a coupon for half off dinner there was a no-brainer.

I've bought a few other daily deal coupons:

  • A discount at my favorite thrift store
  • A coupon for a cocktail bar a friend and I have plans to check out
  • A ten-visit pass at the local climbing gym

Again, these were activities I'd been wanting to do anyway. So far, I've been delighted with each of my Groupon purchases. They've saved me real money on things I was definitely going to buy anyway.

The “one day only” sales tactic works for me, too. There's something about the time pressure of these deals that gets past my normal resistance to buying Stuff. I know I can slip into “shopping mode” and start overspending, and that awareness sometimes makes me too cautious. I don't want to buy anything for fear of flipping the switch. A daily deal site is kind of great for a shopper like me: They offer a deal a day, and I take it or leave it. Even if I buy that one thing, I won't be tempted by the item sitting on the shelf next to it. While a lot of these sites do have multiple deals running simultaneously, they don't push you to browse for more the way, say, buying a book on Amazon pops up a whole string of tempting “recommendations”.

In my case, this has worked out well. I'd been wanting to join that yoga studio for months. I looked at their web site so many times I memorized the class schedule. I asked friends about their experiences there and heard only rave reviews. I walked past it at least a few times a week and stared in the windows. I made a New Year's Resolution to take a class there. New Year's stretched into March, and I still totally meant to do it.

But I never got past my own resistance to spending “unnecessary” money. Even when my doctor told me I needed more exercise and my therapist suggested taking up a meditative practice. Yoga is both. I'm so happy to be doing it now; I've been going to three classes a week and loving every minute of it. The Groupon was just the right nudge to get me over my shopper's paralysis and in the door.

The Dark Side of Deals
I probably sound a bit like a Groupon groupie. As I said, it's been great for me so far. I'm acutely aware that the deal is almost too good to be true, and that some people will be bitten by it. There's an obvious dark side to daily deals. At heart, daily deal sites are just another avenue to entice you to buy more Stuff. Whether it's real physical Stuff or meta-Stuff like classes and restaurant meals, it's still Stuff you spend your money on.

When you're offered a deep discount on something, it can seem appealing even if you don't really want or need it. So far, I've managed to stick to a firm personal rule of never buying a daily deal for anything I wasn't already planning to spend money on. I'm comfortable with those purchases: They're things I want, and I could afford them at the discounted rates I paid.

Not everyone escapes the smoothly oiled marketing machine of the daily deals so well. Time has a great piece up on their It's Your Money blog about “Groupon remorse”. Some people buy so many coupons they need spreadsheets to manage them. There's a whole secondary market emerging in people reselling Groupons and other daily deal coupons that they bought and then realized they were never going to use. (If you want in on that action, you can check it out at Lifesta.)

To the extent that they encourage you to buy Stuff, the daily deals are just one more frugality buster. A half-price dinner out is still more expensive than a home-cooked meal. If buying Groupons becomes a habit for me, it'll lead me to spend more than I want or need to, on Stuff I don't really need.

Used wisely and sparingly, though, it can be a tool for some great deals on things you'd be spending your hard-earned cash on anyway.

Have you tried Groupon, or another daily deal site? Have you loved it or loathed it? What's your strategy for making sure you only buy deals you'll really value?

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Lucas
Lucas
9 years ago

My fiancee and I use coupon sites to check out new eateries in our area. We live in a touristy area of Florida, and since the economy has been so wonky on the gulf coast lately, there are constantly new restaurants and bars opening up (and old or not-so-old ones closing down) near us. The new places almost invariably offer a Groupon or Crowd Savings to get people in the door. We’re self-confessed foodies, so we want to try all the new places, anyway — the coupons make it possible for us to do so when we otherwise probably couldn’t… Read more »

Sonja
Sonja
9 years ago

I love Groupons for date nights. Having a 50% off coupon for dinner out helps offset the price of a babysitter for our 3 kids. However, we did go to one of our favs with a Groupon recently and ended up amassing a bigger bill than anticipated with $9 drinks we somehow justified because the food was so inexpensive. (Alcohol sometimes is not covered by Groupons, check the fine print.) I would have been more upset about it but it was a celebratory dinner, so I chalked it up as a learning experience — and additional revenue for a fav.… Read more »

Meg
Meg
9 years ago

Like Lucas(#1) I also mainly go in for restaurant deals, which I run by my BF before buying. I find just waiting a few minutes(and checking the business out on Yelp) is enough to keep me from getting something I regret.

Alexandra
Alexandra
9 years ago

I go to an internet site that houses all the internet coupon deals for my particular city on a single page. I check it every day – it takes thirty seconds to scan about thirty deals. I really only take advantage of restaurant deals located near my work. I go out for lunch every day, and so the coupons are great for that. Almost everything else I ignore. I do have to mentally check myself because some of the deals are really outstanding. But I just ask myself, “do you really need a dozen roses, even if they are 75%… Read more »

Elizabeth
Elizabeth
9 years ago

I hate to say it, but I find these services pretty useless because they either don’t service my area yet or their offerings are very limited. (They’re still growing in Canada, what can I say?) What concerns me is what these deals are doing to small businesses. Most people don’t understand the costs that the business pays to have a deal through sites like Groupon, not to mention the loss they’re taking on the deals themselves. There is some research already that suggests that businesses aren’t seeing return customers or people spending much more than the deal is worth. (I… Read more »

Ana
Ana
9 years ago

I check the sites daily, but I’ve only ever bought 1 Groupon. I live about an hour away from 2 major cities so what works for me is deciding if it’s worth driving all that way and dealing with parking and whatnot. So far, not too many of the deals are worth it for me. But I still like to look just in case.

And actually these Groupons can be devastating, especially for small businesses who lose money on these deals and often can’t deal with the rush that the deal will bring in.

Mel
Mel
9 years ago

I have a sibling who works for a business who runs Groupon deals on occasion. She said a lot of the people who have used the Groupons have been the nastiest, rudest people. She works at a salon and the people who use the Groupons often do not tip or will complain about the service to try to get the service they purchased at a deep discount for free. The owner of the salon gives the employees no warning of when she is running Groupon promotions. My sister is already struggling in this economy and the commission she makes from… Read more »

Brett
Brett
9 years ago

Sierra, I love using Groupon and related sites. Because of these, for instance, I am going skydiving in less than a month, but also have used them for a SCUBA class, going wine tasting, watching a medieval comedy show, gone on a pirate cruise, and so much more. They really are fantastic, and great to discover the city or area you live in. When I first discovered it, I bought most deals that come out. Today, I buy way less since I know that they come with expiration dates, and I don’t want to buy something I won’t use. Also,… Read more »

Wojo
Wojo
9 years ago

My wife bought something from Groupon for the first time this past weekend. At first, I questioned the purchase, since it wasn’t something we needed, but in the end it ended being a nice night out (it was 4 movie tickets) at a great price. I think as long as we can keep it sparse, this will be something to take advantage of.

Stephanie
Stephanie
9 years ago

We do a lot of Groupons for date nights, and I recently tried out a yoga studio with one. I find that I try a lot of places I didn’t even know existed.

#7 Mel – Some of the ones I’ve had say tips should be based on the regular price, and I can’t even believe they have to say that. Until I started getting discounts through one of my employers, I didn’t even realize people would consider tipping on the discounted price. Sad. I’m sorry for your sister. Some people are obnoxious.

El Nerdo
El Nerdo
9 years ago

I’ve registered with this and Living Social with my coupon-junk-email address, and so far all I see is yuppie products and services aimed at derailing my budget with the help of deadlines that promote impulse buying. Which is the antithesis of good money management and living frugally. I’m at the point where I don’t give a damn about publicity, and can laugh at the nonsense, but it just adds to the clutter of my inbox, and who wants clutter? I profit much more by registering for coupons with stores and brands I patronize on a regular basis, and wait until… Read more »

Crystal
Crystal
9 years ago

I haven’t joined the Groupon circle yet but only because the right deal hasn’t come along. I appreciated this post since I wasn’t 100% sure how Groupon worked. If I see a Groupon for the kick boxing studio at the entrance of my neighborhood, I’m there!

Eugene
Eugene
9 years ago

The Economist has an article this week about Groupon Anxiety:

http://www.economist.com/node/18388904

Nancy L.
Nancy L.
9 years ago

Maybe it’s just the region where I live, but Groupon rarely has deals that interest me. I’m not going to go drive 40 minutes away to try a pizza place just because I got a discount on the meal, and in our area, I know all the restaurants well enough that I only buy deals for places I actually go to. I think the places around here understand how to use these services, bc the deals they offer are still generally fair to the businesses. For example, you might get $50 worth of food for $25, but the average bill… Read more »

Jane
Jane
9 years ago

Now that my husband and I already have three or more Groupons for restaurants, I’ve decided that we shouldn’t buy more until we’ve used these. With the preponderance of daily deal sites (Living Social etc.) I’m sure there will be a lot of frugal people who get suckered in to spending more money. Like Sierra said, a half off meal is still more expensive than eating at home. But it’s oftentimes hard to really gauge whether or not this would be a meal you would go to anyway. Last month I received an offer in the mail to a really… Read more »

NooraK
NooraK
9 years ago

I’ve gotten Groupons for RedBox and Blockbuster Express to save even more on cheap movie rentals. Around Christmas, I got a $100 credit for $35 to a website that makes photobooks and got gifts for family. I recently got a Groupon for 6 months of Sunday-only delivery of my local paper so I don’t have to go to the store to get coupons. Yesterday, I had my oil changed at the local dealership with my $15 Groupon. It’s tempting to fall for the “buy it before it’s gone” line, but I’m trying hard to only get things I would otherwise… Read more »

Jesse
Jesse
9 years ago

I love Groupon! I am very lucky to live close to NYC where this type of deal works best. I also use ones for my home state and have yet to be disappointed. I learned to scuba dive (something I always wanted to try but couldn’t justify the cost), seen amazing museum exhibits, gone on a walking tour of Little Italy, and taken ballroom dance lessons. I found that there was so much to do even in my own neighborhood that I could actually afford if I use a Groupon. I think the success of this type of program is… Read more »

Laura
Laura
9 years ago

The one problem with Groupon and other deals is that the underlying mentality in even looking at them isn’t “What will I save money on” but rather, “What will I spend money on”. Just surfing these sites shifts me into a spending mentality. As Sierra points out, this can only be good if it’s for something I was planning to buy anyway (after looking at Consumer Reports, Google and/or yelp.com); usually that means I have a particular vendor already in mind. So I’ll either go to their website directly to see what deals/sales they’re offering, or I’ll patronize a small… Read more »

Brandy
Brandy
9 years ago

Groupon is similar to using coupons and taking advantage of deals in a store, it is a tool only. If you cannot resist spending money, you cannot blame the tool for your issue. If Oreos are half off, it doesn’t save you money if you weren’t already planning on buying them. If you’re new in town and want to explore your new city, Groupons can be a great way for you to do that. Can’t afford that pricey French restaurant that everyone raves about? A Groupon that costs $20 for $50 of food lets you sample their appetizers and desserts.… Read more »

squished18
squished18
9 years ago

My experience mirrors Nancy L’s comment when it comes to the size of the deals. A lot of Groupons I see now offer a deal for the fraction of the typical total cost at the store. So a golf store offers %50 on $40 worth of purchases knowing full well that if you buy anything there it will typically cost you over $100. So far I have not been that impressed by Groupon and have only bought once in over three months. I’m thinking of stopping their regular emails to my Inbox too.

Tom
Tom
9 years ago

I am not a part of Groupon but happen to love Living Social for three reasons: 1. I live in Northern Delaware, which Groupon really considers to be a suburb of Philadelphia. It is a 40 minute drive to philly to an area I probably don’t know very well. Good chance I’ll never buy anything on there. LivingSocial offers a “site” for Wilmington DE and looking at their list, some other smaller metropolitan areas. 2. Groupon is so secretive in comparison to LivingSocial. You can go to LS’s website and see the day’s current deal in any city without giving… Read more »

retirebyforty
retirebyforty
9 years ago

I agree with #18 Laura. Groupon is just another way to separate me from my money… 🙂
It’s much easier to really save money by spending on what I really want. I’m not very good at giving into temptation so I just don’t join Groupon.
I went to a local crepe/rice pudding place and they were inundated with Groupon people the day after the coupon expired. Man, the owner gal was starting to get mad, but what can she do? She wants to gain new customers.

Melanie
Melanie
9 years ago

Yes, the daily emails from sites like LivingSocial, Groupon and Eversave may be crowding up your inbox. And yes, for some people, it may just be a waste of time. I suppose if you are going to use it, you have to have a system….For me, I only purchase things that I know we’ll use in the future. Recently, I got two movie tickets for $9.00. I don’t even spend $9.00 on ONE movie ticket…Oh, and it expires at the end of the year? Great. I have time to use it… (Now to find a groupon that gets you a… Read more »

Elizabeth
Elizabeth
9 years ago

@ Ana and Mel — Agreed! The one coupon I did buy was for a major retail book chain. After I learned more about how these sites affect small businesses, I passed on a coupon for the local dry cleaners because I felt wrong entering into that dealing knowing I’d be hurting the business. I’d rather except a lesser deal (they have regular specials) and establish a good relationship with the business instead.

It’s really made me think about how I view large retailers versus independent ones.

Brigitte
Brigitte
9 years ago

I too am very selective with what I buy through Groupon or similar sites. Several have popped up in the Detroit area. I have only purchased two. One for a coffee shop I was planning on trying anyways and one for a local gymnastics place my dd has been wanting to go for a while.

Ed
Ed
9 years ago

Never used or have seen a groupon, but I will check out the site today and see what I can find.
Hope it is not like ‘snipe’ hunting.

John
John
9 years ago

While I’m sure that there are folks who don’t tip very well when using coupons, there are folks who don’t tip well when not using coupons. As some have said the waiter or server may change their atitude or service for the worse once they know you’re using a coupon. In which case I say they deserve a miniscule tip if any at all. This also may contribute notion itself, rather its possible coupon users are bad tippers because they get bad service.

Colleen
Colleen
9 years ago

I’ve loved these (groupon & living social) and we’ve used them for the experience options rather than any stuff or services. Have been rock climbing, on a bus /walking tour of Seattle, museum, movies and a boot camp. Have wanted to do all of these things and getting to do them at 50% or more off has enabled us to try some things that just weren’t in our budget otherwise.

Erica
Erica
9 years ago

I cringed when I read this subject line. Groupon pretty much ensured they would never get my business after their Superbowl commercial ads, which were an exercise in poor judgment. Here’s the one about Tibet: http://www.youtube.com/watch?v=vVkFT2yjk0A I’m not speaking for anyone but myself, but that was definitely a dealbreaker for me. With services like these, it just seems like “deal fishing” to me, looking to spend money on a “deal” when you could just otherwise abstain and save the money instead of spending it on something you weren’t planning on purchasing. If you were going to spend the money anyway,… Read more »

Elaine
Elaine
9 years ago

Geez, all the ripping on Groupon. No, its not perfect. It’s not for all areas (just cities mainly) and it’s not for all demographics. lighten up… I use it mainly for clothing stores, workout classes and some beauty places. My boyfriend jumps on the restaurant deals and car washes. Coupon books are on the out, and so for my generation I think it is great. I subscribe to LivingSocial and MyDailyDeals but have only used those once each. All the businesses I have gone to have treated me very well and I have tipped according. Only a few I have… Read more »

Anne
Anne
9 years ago

I live in Vancouver, Canada and have been using Groupon. I got a month’s unlimited yoga sessions for a great deal at a studio I wanted to go to, but could never justify spending their full fee. I got my annual membership to the Vancouver Art Gallery for half price. I was going to renew anyway. So if you stick to the things you were going to do or really wanted to try and get be sucked into buying things you don’t need, I think it works out. If you let groupons expire without using them, obviously it wipes out… Read more »

Dustin
Dustin
9 years ago

I have used Groupon (as well as DailyDeals) quite a bit, nad have a very high level of satisfaction with their service.

One time, a groupon was purchased and the establishment that the groupon was for went out of business soon afterwards – Groupon quickly refunded our purchase without any hassle whatsoever.

Clint
Clint
9 years ago

I’ve signed up but have yet to use because everything is a want, not a need and my wife’s favorite restaurant or another I’d like to try have yet to show up. It’s difficult to feel too sorry for businesses that this is hurting, though. They can say no to the terms of Groupon, too, and more are negotiating better deals for themselves. There’s a story about that in today’s WSJ, by the way,

Abbey
Abbey
9 years ago

This weekend, both my spouse and I will be seeing OUR eye doctor for our yearly eye exams. Both of us have bad eyes and require new contacts and glasses each year. We self insure our eyes using our flex account. These yearly visits can cost our flex account close to $750. This year, we each bought a discount through livingsocial.com. For $65 each, we will each receive $250 towards our exam and glasses. Using Groupon and Living Social to purchase a service I would have already use is well worth it, in my opinion.

Looby
Looby
9 years ago

I agree with some others that groupon is only likely to cause you problems with your spending, if you already have problems with your spending… I’ve found it great for the city I live in, my partner and I got half price memberships for the gym we wanted to join, and for the gardens we like to visit. I’m taking him to his favourite restaurant for his birthday with a groupon this weekend. I’ve also just bought my mum her mother’s day gift (it’s in April in the UK) with a groupon and I’m ordering a photobook for my friend’s… Read more »

Rita
Rita
9 years ago

I am not a fan of Groupon in general. I have purchased 2 deals from the site in the past (one for me and one for a friend) but I now feel that the negatives outweigh the positives. As someone above mentioned, Groupon advertises for all different types of businesses, so you are often sent deals for items or services which you don’t normally purchase. They are encouraging you to part with your hard-earned money everyday! From the small business perspective, Groupon is not that great of an advertising strategy. It seems that Groupon has created a group of loyal… Read more »

GJ
GJ
9 years ago

To date, I have purchased two Groupons: one for amazon.com ($10 for a $20 credit) and one for a local coffee shop ($5 for $10 gift card). I haven’t used the amazon one yet, but we are always buying gifts and other items there, so I felt the “insta-50%-off” was a great deal for us. I would caution other buyers to read the fine print carefully, though. I got the coffee card for a place I often meet my girlfriends at and thought this would be a good way to pay for two of the gatherings. I didn’t realize until… Read more »

Mary
Mary
9 years ago

#2, Sonja– Depending on which state you live in, legally, you may be able to get back the money your originally paid (not the face value of the coupon,) if you didn’t use the coupon before it expires. Read the fine print on the Groupon site. I’m not sure how hard it would be to actually do this, but I know it’s the law in the state where I live. Also, I work for a business that ran a Groupon and it was looked at as a marketing expense. Just like any advertising, running a Groupon costs a lot of… Read more »

Suzanne
Suzanne
9 years ago

I’m surprised that people think Groupon hurts small businesses. I’m a Groupon fan and have bought 4 of them in the past year. I am getting my bike tuned by the local bike shop, I have tried out 2 restaurants (not chains) that I never would have tried, and I signed up for zipcar. The businesses may give a deeper discount than they would in any other forum, and they may have to pay Groupon a percentage, but they get cash up front. A amall business can use an influx of cash to do a lot of things without having… Read more »

Meghan
Meghan
9 years ago

@Erica (#29) I’m glad you brought that up. Almost as bad is the Groupon “deforestation” ad with Elizabeth Hurley. Also in poor taste IMO.

Charlotte
Charlotte
9 years ago

I liked most of the deals I got and the fact that there was no hassle to use any of them. A lot of less known businesses promote themselves on Groupon. I like discovering new places if only to support the local economy. In this case, the discount is less important. A couple of times I bought stuff I didn’t need. Groupon refunded my money when I canceled it. What I didn’t like – having to keep track of groupons and remembering to use them. Also, the amounts are sometimes defined such that you end up spending more. For example,… Read more »

Taylor Ellwood
Taylor Ellwood
9 years ago

From a busienss perspective, Groupon and other social coupons are mixed. Some businesses have been hurt by using such sites, because the coupons that are offered only pay Groupon, as opposed to the businesses themselves. What businesses hopefully get is visibility and exposure, but many people will mainly use groupon to get coupons, use them, and move on to the next deal.

SL
SL
9 years ago

On the rare occasion that we go out to a local restaurant, I want to pay in full and leave a big tip. I dislike being cheap with local businesses.

I think the whole Groupon craze is another form of consumerism and similar to going to a 99 cent shop and buying a bunch of stuff you don’t need but get it just because it is on sale.

Claudia Lynn
Claudia Lynn
9 years ago

I guess I also don’t really understand how Groupon is so horrible for small buisnesses…if its such a bad deal for them then why would they sign up? Its not like they’re being forced to offer Groupons.

Alyssa
Alyssa
9 years ago

I think Groupon (and the other similar discount websites) is great when used appropriately. They’re bad when people use them as a reason to buy Stuff (even if that Stuff is in the form of restaurant gift cards or other intangibles). I have one Groupon regret that I still have, but I’ve learned my lesson. However, Groupons are amazing when you can buy experiences that you would have likely never learned about nor wanted to have purchased at full price. I purchased a Groupon for a painting class, and I have since gone back 4 more times (paying full price)… Read more »

Ely
Ely
9 years ago

I’m lukewarm on the concept. I can see they can be a great way to save money, but I’ve had problems. One is, we end up spending more than we would have because we think we’re getting a deal. Another is I feel pressured to go out because I have a discount, when it turns out I’d be perfectly happy not going. Also my husband is an impulse shopper, so they are dangerous for him; he ends up buying discounts we don’t need and probably shouldn’t use. If you do it right I’m sure they’re great. I guess I’m just… Read more »

partgypsy
partgypsy
9 years ago

The people I know who use groupon or similar deals are the people who yes eat out or do social activities more often than I do BUT are going to these places because of the coupons. I really haven’t seen these people have any loyalty but rather looking to see what fresh blood er coupon has showed up next. Also it has taught them NOT to spend unless there is a coupon or discount attached, again decreasing the chance they will refrequent a business, even if they liked it! I do like the idea of businesses giving out 10% or… Read more »

Rich
Rich
9 years ago

I’d like to put out a strategy for saving money on the go. I have a plan to go to a conference then a vacation afterwards in San Francisco then Napa Valley.

My strategy is that I monitor the deals in my area looking for things that are on my list of todos around locally and then add the place that I plan to go to later also. Saves TONS on my trip costs. Food and activities at 50%+ off.

Ginger
Ginger
9 years ago

I use groupon/livingsocial for restaurants that look like we would like to try or already have tried and like as well as massages (I hurt my back and monthly massages help but I can’t always afford them so half off helps me afford them), and for other things we know we will use, like amazon. This has saved me a lot of money but yes it requires self control just like normal coupons.

MutantSuperModel
MutantSuperModel
9 years ago

I actually JUST bought my first coupon– a one year Sunday only subscription to the local newspaper for $10. I’ve been wanting to subscribe for months not but held off. Six months of Sunday only on “sale” is $20 so I knew when I saw the Groupon this was the perfect way to do it. Now I get Groupon emails and honestly don’t look at them. I found out about this particular Groupon through a couponing website.

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