I’ve been asked by a number of clients and friends recently about whether they should consider using ‘Groupon’ or other similar daily voucher deal sites to promote their business and potentially increase their customer base and market, and in each case my answer has been the same – will you cover your costs by doing so, and can you cope with the demand that may follow?
It seems now that a number of concerns about the Groupon business model are being expressed, by many illustrious and well regarded voices. Josh Catone has written an excellent article on why Groupon must change which explores exactly the issue I raised with my friends – how a small business caters with the potential demands, and whether this is actually going to lead to sustainable business growth in the long term. Even more worrying for Groupon, there are many concerns being expressed for it’s long term financial viability, including this blog by Michelle Conlin, of AP.
Of course, Groupon are not the only exponents of the voucher system, many other companies including Amazon.com and Google are also offering similar deals and incentives. I would urge caution to all those considering either purchasing vouchers as a consumer, or using these promotional tools for their business. Remember, if something looks too good to be true it probably is, whichever side of the deal you’re on.