Everything you need to know about Groupon, plus a special offer for new customers (2024)

FAQs

What are the cons of Groupon? ›

Prices might be inflated, you could end up buying unnecessary items, and quality can vary. Read reviews and fine print before you buy. Groupon can offer such steep discounts because it guarantees business owners a minimum return on their investment and the possibility of becoming an overnight sensation.

For just $4.99 per month, Groupon Select members receive discounts across Groupon, including local services, experiences, travel and goods (plus free shipping)––with discounts automatically applied at checkout (no promo codes to enter) and no savings caps or order minimums.

Groupon does not charge any upfront costs for creating and running a campaign on our site. We operate a “pay-as-you-go” model, meaning you only pay for the results, not for the listing.

Consumers use a code or printed voucher for redemption at the time of service. Since the discount is prepaid, the customer owes the merchant only for services exceeding the value of the groupon.

Groupon faced a deluge of competition from other platforms, many of which it acquired. Google's changes to subscription emails dented Groupon's open rates in 2013; in Q3, Groupon reported a $2.6m net loss. The platform struggled to diversify; attempts to offer physical goods faltered.

Despite its impressive revenue growth in the early days, Groupon always struggled with profitability. The high churn rate of merchants, the rise of digital advertising platforms like Google and Facebook, and the unsustainably high fees charged to merchants were among the factors that led to Groupon's downfall.

Over the past few years, the number of Groupon shoppers has fallen sharply. From nearly 54 million unique customers purchasing at least one offer on the site in the fourth quarter of 2014, this figure shrank to 17.5 million buyers by the second quarter of 2023.

Groupon charges 50% of the sales revenue as its fee.

“Groupon Select is the best way to experience Groupon today and discover even more value on local services, experiences and goods. It accelerates the savings we're known for and makes Groupon an even bigger part of members' daily routines,” said Groupon CEO Rich Williams.

The best overall Groupon alternative is Travelzoo. Other similar apps like Groupon are Vagaro, dealsaver, Localflavor, and Gilt. Groupon alternatives can be found in Merchant Marketing Software but may also be in Spa and Salon Management Software. Have you used Groupon before?

Is Groupon worth it for a small business? ›

Do businesses make money from Groupon? Businesses can make money from Groupon, but it's not necessarily a significant profit. This is because you're offering large discounts on your product, and Groupon takes 50% of the revenue you make on each item.

Promote Your Campaign Further

And if you want to give your campaign even more exposure, try Ads for Campaigns! With Ads for Campaigns, your Groupon campaign gets boosted to the top of search results and browse pages to increase visibility and bring in more customers.

In addition, the Groupon refund policy states that:

For Local Deals, customers can return any unredeemed Groupon for a refund of the amount paid within the first three days after purchase. After that, all sales are final unless stated otherwise in the Fine Print.

Vouchers cannot be redeemed until 24hr after purchase.

So if you have a Groupon, tip 20% of the full, pre-Groupon value of the bill. Think about it: with or without a Groupon, your server is still balancing the same heavy plates, fielding the same questions about substitutions, and knitting the same napkins by hand. Of course, 20% is just a rule of thumb.

Read Reviews

If you buy goods on Groupon, check the reviews to see whether other customers believe the item is represented accurately on the website. As for services, watch for red flags that could indicate a fraudulent deal, such as no reviews or very few purchases.

There are no upfront costs required to advertise on Groupon. They will take 50% of the profit you make on each product.

The best overall Groupon alternative is Travelzoo. Other similar apps like Groupon are Vagaro, dealsaver, Localflavor, and Gilt. Groupon alternatives can be found in Merchant Marketing Software but may also be in Spa and Salon Management Software. Have you used Groupon before?