When I was looking through the recommended blogs on the blogroll, I stumbled across this article 4 Easy Ways to Lose Money Partnering with Groupon
I understand that from a company’s perspective advertising on such a global and well known site as Groupon helps with brand exposure, however from my personal experiences with Groupon I definitely feel that companies – especially restaurants – are hurting themselves more than reaping in the benefits that they perceived should happen.
Many fine dining restaurants have participated in Vancouver Groupon. Seeing these amazing deals for “fancy food” at a discounted price is very appealing to me, and definitely draws me in into purchasing the Groupon for the restaurant. I am clearly not the intended target market for fine dining restaurants at this point in time, but by putting themselves on Groupon the restaurant is really opening themselves up to the entire market without any segments or variables.
With my Groupon in hand, I headed to the restaurant that I had purchased the coupon for. However the service was absolutely atrocious. Because I had a Groupon I felt like I was treated at a “lower tier”. I feel that this is wholly unacceptable because the restaurant put themselves on the site and they are the ones offering the discount (#3 of above linked article). It would make more marketing sense to draw a consumer in and amaze them with phenomenal food and service and hope that they will be so astounded that the will make multiple return visits. Treating your customer in a negative manner will not only turn them off from coming back again but could cause a negative word of mouth to surround your restaurant.
So, although Groupon may seem like a smart way to expand the recognition of your brand or company, it is important to think of the ramifications of offering such massive discounts on your product.
I wholly agree with all that was written in the article and I felt that it encapsulated a lot of the things that is wrong about using Groupon as an effective marketing tool.
