How to Make the Most of Groupon

How to Make the Most of Groupon

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Groupon is an excellent example of a contemporary business model, something college business professors would do well to include in their course study. Psychology professors might be interested too as the appeal of this online phenomenon offers a glimpse of the intricacies of human behavior.

Deal of the Day

For those of you not familiar with Groupon it is a “deal of the day” website that launched in November 2008, serving more than 300 markets and 35 countries as of March 2011. These deals are targeted locally which means that if you’re in Philadelphia, the deal is for your area only and covers such bargains on places to eat, entertainment, things to do, places to go and the like. A dazzling price is dangled before Groupon faithful daily, but it goes beyond a bargain: it has to be a great product or service as stated on its website.

Admittedly, my use of the website has been more recent and I haven’t bitten…yet. Oh, the temptation is there especially when I find a 52 percent discount to the “North Carolina Museum of History” being touted. Yes, I can get in to this museum for free, but with this offer my family gets into ticketed events for free. Moreover, we’re eligible for discounts on museum store purchases and on museum sponsored trips, tours and camps.

Major Discounts

And that is the remarkable appeal of Groupon: discounts of 50 to 90 percent on quality products and services.

The Groupon model is worth exploring from a business angle as it offers protection for retailer and consumer alike. Just one coupon is provided locally daily and everyone can come out a winner. The way it works is simple too.

For example, a theater may want to ensure that opening night is a success thus it offers its best seats, retailing for $100 for just $40, representing a 60 percent discount. On a predetermined day, the offer is emailed by Groupon to everyone in proximity to the theater and posted on Groupon’s local site. Word spreads virally as people forward the email, post the information on Facebook and Twitter or through other social media websites.

Although the “deal of the day” may only be featured for one day, deals are usually available for a few days or until the allotment has been filled. Let’s say the theater makes 100 seats available — people are given a certain amount of days to make a purchase before the offer is completed or the seats are sold. Groupon and the theater split the $40 and opening night is packed with people who enjoy a huge discount and, hopefully, raved on and on about the show.

Cashing In

Groupon customers cash in their deals by printing out a voucher or by bringing it up on their mobile devices, presenting it to the business when they want to redeem it.

Is there a catch? Just one: a minimum number of sales need to be made before everyone can enjoy a discount. For example, if the theater absolutely must have at least 30 seats sold, then the discount won’t be offered if just 23 people show interest. Of course, that is what makes Groupon special: interested users will spread the news to everyone so that they can get a discount. Mob or mass appeal is what Groupon is all about: explain that to your psychology professor and see what she has to say.

As for deals for college students, you may do as well if not better by flashing your student I.D. If not, you have Groupon to go to the next time you want to order $40 worth of pizza for you and your friends and get it for half price.

Adv. — For more deals, visit nBuy Shopping Plaza where more than 5,000 retailers are open for business.

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