Is Groupon's allure fading?
The New York Times published an interesting article about how the appeal of Groupon (and other copycat coupon sites) is waning for merchants.
The consumers were being told: You will never pay full price again. The merchants were hearing: You are going to get new customers who will stick around and pay full price. Disappointment was inevitable.
In fact, it gets worse for merchants: research shows Groupon customers are harder to please, and can in fact negatively impact a company’s reputation (emphasis added):
the long-term reputation of the merchant may be at risk, according to a new study by researchers at Boston University and Harvard that analyzed thousands of Groupon and Living Social deals. The researchers found that fans of daily deals were on average hard to please. After they ate at the restaurant or visited the spa, they went on Yelp and grumbled about it. This pulled down the average Yelp rating by as much as half a point.
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