I love a good coupon. When Groupon came to a city near me, I joined up immediately and began buying coupons that my family could use. However, not all of the deals that Groupon, LivingSocial and similar sites offer are as great as they seem.
Before you buy an online coupon, read on to discover five things you should know before plunking down your cash:
– You may not end up using your coupon. Daily deal sites report that nearly half of the coupon vouchers buy aren’t redeemed. Whether it’s due to a coupon expiring or forgetting you have one, it doesn’t make sense to give a daily deal site your money for free. Some businesses have stopped accepting coupons when it too severely damages their bottom line. To avoid wasting your money, only buy vouchers for things you already do or items or activities you’ve been wanting to do. Forget spending money on vouchers for things that you haven’t been motivated to do already, such as joining a gym across town.
– The discounts aren’t always as stated. Many daily deal sites calculate their discounts as anywhere from 50 percent and up. However, these discounts don’t take into account regular specials that the store runs. For example, one pizza chain was part of a daily deal that offered $8 for a large, multi-topping pizza that was 50 percent off its normal price. However, that pizza wouldn’t have been close to $16 if the customer had ordered through a regular special or through carryout. It pays for daily deal site customers to check out a business’s prices before spending money on a coupon that might not be worth it.
– The sites or businesses may disappear. The national attraction to Groupon spawned hundreds of similar sites, many of which serve a small portion of a state. Restaurants, which have taken advantage of these sites, can fold at a moment’s notice. You are taking a risk when you buy a coupon for a specific business. There isn’t much you can do to minimize that risk except for buying the voucher with a credit card, because you can charge back the cost of the coupon if the site you bought it from goes under.
– The businesses may not be legit. While you can trust that national chains are offering good deals, vouchers for smaller, more unknown businesses may not turn out to be great. Groupon had to cancel a deal from one Atlanta photographer after some users accused the photographer of claiming that the work of others was the photographer’s own. A business with shady practices can probably be a part of a daily deal site, so make sure you check out the business with the Better Business Bureau before putting up your cash.
– Legal questions about these sites need to be resolved. The courts are in the process of deciding whether daily deal sites offer coupons or gift cards. If they are gift cards, the vouchers must be valid for five years under federal law. If they are coupons, they can have the expiration dates that they claim.
Kelli B. Grant, 10 Things Daily Deal Sites Won’t Say. SmartMoney.
Staff, The dangers of Groupon for your brand – and its own. Schmoozy Fox.
Glenn Kelman, Groupon’s Success Disaster. Redfin.