The Daily Internet Deal: A Tale of Two Groupons
When my kid brother was about 14, he begged my mom for a lathe for Christmas. It was expensive, but Roger was a quiet bright kid who didn’t ask much. When he tore the wrapping off the long wood box on Christmas Eve, my mother beamed.
“Now you can make us new kitchen cabinets!”
A lathe is a great tool if you want to turn out chair legs, salt and pepper shakers or Louisville Sluggers. It's not the tool of choice for cabinet doors.
For me, the lathe was an unforgettable lesson in expectation, capacity and function.
This spring, I carried a $60 Groupon into a Janet Rufin’s Salon in New York City. I wanted to find out why a business would expect to make an eventual profit on a Groupon. My expectation: a bargain. The salon’s function: a profit. The capacity of the Groupon as a useful tool? Yet to be determined.
In case you don’t live in one of 40 U.S. Groupon cities, a Groupon is a localized coupon that’s e-mailed to your inbox every day. Groupon is a Chicago-based company that recently turned down a big buy-out offer from Google. Groupon has over 7,000 employees and is growing like a virus. They will be launching an IPO “very soon” according to the Wall Street Journal .
Groupons, or group coupons, seem perfect for impatient, value-driven times. The pictures are enticing, the descriptions kitschy and pithy and the deals are unbeatable. For a value-conscious consumer, Groupon hits the spot.
It’s easy and free to sign up. Deals require minimum participation and usually disappear within a day, though a Groupon can often be usable for up to a year.
It’s genius. Pant, rant and buy.
Small business owners want to believe they’re special. "Once someone tastes our gelato or gets our haircut, they’ll break the doors down!"
Vendors might be fishing for marlin and wind up with jaded catfish like me, customers who suck up value and swim away, leaving the small business with a loss. I never intend to pay $120 for a Big City haircut. I just wait in the depths for another haircut deal to swim into my inbox.Continued on the next page