What are the disadvantages of Groupon?
Groupon Deteriorates The Value Of Your Business If company X can offer a 50% discount and still make a good profit, then they must be jacking up their prices. Once a customer receives a large discount, it trains them to wait for later coupons and deteriorates the value of your products and services. Why the downfall? Critics have long called Groupon’s model unsustainable. Customers get subpar services from swamped businesses, while businesses get a bad deal in the long term. One analysis found only ~20% of Groupon buyers returned for full-price purchases.Here’s the short answer: Groupon is a legitimate marketplace that connects you with verified businesses offering real discounts. Still, your experience depends on reading the fine print, understanding how vouchers work, and knowing when Groupon—not the merchant—handles refunds.The deals offered daily through Groupon start at 50 percent off and can go as high as 90 percent cheaper than the normal price. 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.Should you be buying groupon stock or one of its competitors? The main competitors of groupon include tripadvisor (trip), 1-800 flowers. Com (flws), petmed express (pets), carparts. Prts), amazon. Amzn), netflix (nflx), booking (bkng), expedia group (expe), newegg commerce (negg), and jumia technologies (jmia).Revenue declined by 80% from its peak in 2014. Groupon is still losing money with less than 1 year’s worth of cash to sustain its runway.
What are people using instead of Groupon?
Best Alternatives to Groupon There are several sites that offer a similar business model, like LivingSocial, Yipit, or Woot. Groupon, American e-commerce company that offers deep discounts, usually 50–90 percent, for popular products and services by using a group discount model. The company’s name is a portmanteau of group and coupon. Groupon was cofounded by Andrew Mason, Eric Lefkofsky, and Brad Keywell in 2008.After the deal is live, Groupon collects the revenue earned from your product or service sales and distributes them to you every 30 days. They usually take around 50% of the profit you receive from selling your product on their service.The customers they won with damagingly low deals on Groupon did not become loyal customers but moved on to exploit the next amazing deal, leaving small businesses with only the costs. As a result, they pulled back from their deals, and Groupon had to expensively acquire new businesses to keep the deals site full.Consumers: Groupon deals save you money because you pay less than the full retail price on goods and services. They even offer some student discounts. But it isn’t always easy to find deals for things you want or would enjoy doing. The fine print can also turn an amazing deal into something you can’t or won’t even use.
What are the cons of Groupon?
Groupon deals may be unprofitable for businesses with variable operating costs because they often need additional staff and supplies to satisfy a sudden increase in demand. Daily deals may also attract customers outside the merchant’s target audience, reducing the rate of repeat visits. Groupon’s business model relied heavily on offering deep discounts to attract customers, which did not result in long-term customer loyalty for the merchants. Many businesses complained that the deals were not profitable and did not lead to repeat customers.Despite the fact that demand and revenue on its platform are shrinking, Groupon must deploy sales executives to cover local territory and bring in paltry new supply. Lack of scale in certain markets (which is happening in many overseas markets) causes Groupon to lose heavily.
Is there a better site than Groupon?
Explore other competing options and alternatives. Other important factors to consider when researching alternatives to Groupon include price and customer service. The best overall Groupon alternative is Vagaro. Other similar apps like Groupon are Travelzoo, dealsaver, Localflavor, and Gilt. Is Groupon legit or a scam? Groupon is a legitimate marketplace that sells discounted vouchers from third-party merchants. Most buyers report positive experiences, but quality varies by merchant, so outcomes can differ. Checking ratings and deal terms before you pay is essential.Contrary to the myth that Groupon always requires a 50% discount and then takes another 50% commission, our commission rate is flexible and tailored to your business. The rate depends on factors like your industry, the discount you set on your offer, your campaign structure, and more.
Why did people stop using Groupon?
Groupon is a great way for businesses to get noticed, but it also comes with some drawbacks. When businesses list deals on Groupon, they have to offer steep discounts, and then Groupon takes a big cut of the revenue. That means less money going back into improving our lanes, food, arcade, and overall experience. In recent years, Groupon has shifted greater focus toward higher-margin local experiences and services, phasing out lower-margin goods. As of 2025, Groupon’s Local segment in North America was the primary growth driver.