My experience with Daily Deal sites - The Good, The Bad, and The Ugly

2013, Aug 03    

There are a couple notable comparisons  of daily deal sites.  Most people have been using them for a while.  Many are shifting to a more “on-demand” type service.  These include finding deals near me right now with my phone. But, since you are purchasing through these daily deal sites, you essentially have a middle man.  This middle man can make or break you.  Now that I’ve gotten to experience the dark side of them all, here’s my experience with them.

Groupon (The Good)

The original.  Based in Chicago, they started sending out daily email deals in select areas (Chicago, NYC, LA, etc) and have since expanded to everywhere in the US of A.  Some people are concerned with their business model and whether it can scale.   Of course, this argument seems to hold true for all of the clones as well.  Unfortunately, you have to put feet on the ground in each city.  Internet startups don’t like that.  Human capitol is much more expensive.  They like to increase profitability by the only cost associated with growth being adding more computers.  But, since I’m speaking as a customer and not as a internet startup guru, I could care less how the business model will scale.  Only how it affects me.

Groupon has been the pinnacle of light for customers.  I have experienced restaurants/stores closing (or restaurants/stores where they aren’t even sure if they have closed cause it’s still there, but nobody can get in).  They refund everyone immediately without anyone having to call them.  I experienced moving, where I hadn’t used a deal.  I called the restaurant to try and use it, and they were booked.  Guess what?  No questions asked.  They refunded it at my request.  I didn’t even have to call.  Just a quick issue put in on the website and money back in my account.  Amazing.

Some have said to avoid Groupon for your business. This is good information to know, for sure.  However, I disagree with them.  There are definitely good ways to make money on Groupon, but some folks don’t understand the overwhelming crowds or the preparation required for staff.  You just have to be prepared before using them.

Amazon Local (The Bad)

One of many clones of Groupon.  Originally it was just a skinned version of LivingSocial, but eventually the Boise offices took over this one.  Just another extension of Amazon.com, they are very happy just getting their name in your inbox so you never forget about them.  Though, I’m sure they don’t mind the profit either.  Since they originally were just an abstraction for LivingSocial, they are still in the mix, but they can wrap other services as well.  Why not right?  Just be a pass through to other companies?  But they are still expanding their own service too, so not just using LivingSocial or other companies.

Amazon.com is known for good customer service.  My buddy had a TV delivered and it was broken.  They sent him a new one, no questions asked.  No return requested.  They know that the customer is always right and they have complex ways to catch you if you are a liar.  However, Amazon.com is not Amazon Local.  Amazon Local has the problem with their model in that now we have 2 middle men, and neither wants to take care of you because that is the other middle man’s job to do that.  Until I can figure out who I’m actually going to have to talk to for customer service, I’m avoiding them.

LivingSocial (The Ugly)

The first major clone.  Based in D.C., they got their start by selling their services to others who wanted to get in the game.  For example, Amazon Local (another service I’ll talk about soon) was originally served through Living Social.  Since then, they seem to be buying random business ventures.  I have no idea what they are attempting to accomplish as a business, but they are all over the map.  They also seem to be pushing internationally.

First, I have a problem with what they sell.  They attempt to sell international products as well as local.  I ordered an iPad cord and didn’t pay attention to the details of the seller, and it ended up coming from Austria.  Yup, and I paid for shipping.  It was still worth the cost (barely), but it left me with a bad taste in my mouth.  Worse than that is their customer service.  The fine print on your coupon says that you can ask for your money back within a reasonable amount of time.  What it doesn’t tell you is that they will want to have conversations with you and the customer.  Their ticket system isn’t made for back and forth, so if you have more comments, they go in separately.  This means that every time you call them or email them, it’s someone new and they read from the pre-canned messages.  Also, when they try to start a refund, they don’t realize that their intervention (calling the business and discussing with them) is messing with the time tables.  If you have an expiring coupon or issues with the return policy, you may be out of time by the time they are done “researching” it.  Which means another phone call (argument) with a fresh new person.  The last problem I had with them, I had to start 5 issues and called from 2 different accounts (because of problems with gifting - don’t even get me started on how broken that is).  And finally, they don’t like to give actual refunds.  They give it to you in deal bucks, also known as store credit.

Although I live in the D.C. metro now, I can’t suggest this local business.  I would suggest avoiding LivingSocial like the plague, but that’s just me.