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?
Author: Sierra Black
Sierra Black has spent most of her life broke, no matter how much or how little she earned. She started turning that around two years ago with some radical life changes like moving, shifting careers and committing to buying nothing new.
Sierra and her family live in the Boston area. Sustaining a family of five on one salary has led to some creative frugal maneuvers over the years, especially living in an expensive urban area. Sheâ€™s learned how to make a $1 family meal, cut her heating bills in half and save thousands of dollars on travel, clothing and fun.
When Sierra isnâ€™t working magic on her familyâ€™s finances, she writes about personal finance, sustainable living and parenting.