Posted 05 September 2012 - 07:35 AM
Last year I was pestered--no, downright harrassed by at least 4 such companies, some demanding discounts as low as 35% and as high as 50%. This year these companies have seem to have dissapeared--for which I am very gratefull.
No, it is not advertising. Say you buy your mother a bouquet of flowers, you include your card with the flowers. Whom does your mother associate with the flowers--you, or the person who made the bouquet and delivered it?
You have to understand the mentality of Groupon. They exist because they offer 50% discounts. Groupon is not making a loss, they are not compensating the merchant for a 50% loss, but are demanding the merchant take a loss in order to advertise with them. They make thier money from your discount, this is their reason for being--for existing, to offer discounts, not theirs, mind you, someone else's. On top of this they till take their cut-- a percentage of what ever is left over. They have access to this money, not you, as I said before you are a third party to the trnasaction, but provide the product. At this price it is impossible to make any money, every sale is a loss, and what's more, it will take at least 5 or six meals at normal prices to make up for the loss of one Groupon "sale".
I repeat, every restauranteur I have spoken to on this subject tells me that 95% of the customers are only there for the discount, they don't return, and what's more, many are reluctant to splurge on beverages or to tip the waitstaff.
It's a shell game.
Good luck finding a restaurant that doesn't offer Burrittos and a Coke for Groupon discounts.....