Will ‘Groupon Fatigue’ Doom the Daily-Deals Business?

Only a year after Groupon rocketed out of nowhere to become the Internet's red-hot new thing–spawning hundreds of copycats–the hottest, newest thing is Groupon fatigue.

People who kick about too many daily deals predict that Groupon and its imitators may get ahead the next Napster: enormous one day, and bygone the next.

The deluge of deal sites is staggering. Softwood aggregator Yipit tracks a zillion daily deals from 482 sites covering 32 subway areas. In New House of York and other major regions, much 100 deals hit the street every Clarence Shepard Day Jr., says Jim Moran, Yipit's cofounder.

And the man-sized players recently jumped into the scratch: Both Facebook and Google announced their deals plans in April.

Too Overmuch?

Is IT all too much? Monthly metrics from Yipit indicate that Groupon sales fell roughly a third from January to February, and another third from February to Butt o.

Why? Whatsoever people detail to Groupon's trashy Super Arena ads (watch one below). Others pick at the site's uniquely annoying "Groupon voice," in which ad writers layer wordplay happening top of fatuousness to peddle half-slay haircuts and burgers. (Instead of "Groupon tire out," they would probably call it "Groupennui.") Moran says that Groupon's grocery contribution was bound to fall as competitors hurried in.

Groupon's Unsuccessful Topnotch Bowl Commercial

But here's my personal belief: Groupon fatigue triggers when shoppers like me realize that they've gone money on a bunch of deals they didn't use.

Subsequently reading Sarah Jacobsson Purewal's estimate that 20 to 40 percent of discount-coupon purchasers never redeem them, I went out to the service department and found five inoperative deal vouchers below the driver's seat of my Subaru.

They included:

A $25 Restaurant.com voucher for a place that was shut when we tried to eat up there. World Health Organization closes on Tuesdays?
Another $25 Restaurant.com certificate, one of two for a pizza pie office. After the first visit, we decided that $50 was overly expensive for pizza pie, and never went back.
A $20 Groupon for luncheon at a place down the street from a friend's office. We were still trying to get on each other's calendars when the thing expired.
A Groupon for a localised bistro that I think either failed or "disapparated," Harass Potter around-style, because my daughter and I drove all over the neighborhood and could find no trace of it.
A Groupon for 30 days of unlimited yoga classes at a kind of inconvenient locations. Unlimited yoga? WHO am I kidding?

Altogether, I spent $149 for those five pieces of paper–a Benjamin and a one-half. That's mode more than the $45 I saved with the three deals I did use.

Nitty-Gritty Details

A little excavation showed that I might not be every bit stupid equally I thought. According to Groupon, merchants should honor your certificate for the amount you paid for it (non the total deal value) for quint years on the far side its expiration date. In some states, gift-certificate laws keep day by day-deal offers from expiring (but according to the National Conference of State Legislatures, non mine). And it turns kayoed that Groupon will reimburse you if a business fails before you consumption your voucher, so I whitethorn be able to recover that particular $15.

Has the social-voucher concept jumped the shark? Google doesn't think so: It's launching Google Offers in the wake of its failed $6 billion bid to buy Groupon, roll the program out as a public beta. Facebook doesn't think indeed: It recently announced its "Groupon-cause of death" test in five pilot cities. Groupon itself is aiming to resurrect an estimated $20 billion IPO this year, according to Reuters.

Moran doesn't think daily deals are done, either. "Despite crowding of their inbox, consumers are purchasing more, not fewer, deal vouchers. Total revenue for the food market continues to climb month over month," he told me. "These offers are becoming a real channel through which consumers fundament regularly participate in activities they couldn't otherwise give. From spas to golf game to skydiving, consumers are using these offers to plan their weekends and vacations, and ultimately living better lives."

Businesses that have in use daily-deal promotions report sundry results. In a Rice University study of Groupon deals, to a higher degree 40 percent of merchants aforementioned "Nevermore." Even businesses that made money on their cope aforementioned that Groupon customers seldom bought more than face value. And the money-losers cause complained bitingly that Groupon shoppers are terrible earthborn beings–demanding, uninformed, unfriendly, and cheap.

Chromatic Advice

How do you make sure that your daily-deal risk saves you money?

Check from my overpriced-pizza pie experience and get into't grease one's palms more than one of anything you haven't tried. And down on letter box overload away signing rising for an aggregator so much as Yipit, Pricegrabber, Monster Offers, or Shoparatti.

"Be proactive, not activated," Yipit's Moran advises. "Instead of reacting to each bid as it comes your way, decide what you'd like to do, and, betting odds are, you'll be able to make that happen for a fraction of the price."

Don't abuse the merchants by photocopying certificates Beaver State trying to deliver more than one offer at a time. Nearly daily-deal advertisers are small businesses hard to get new customers–not to give away the store. Karma is a real thing.

Plan to use your discount before long afterward you buy it, for two reasons: First, you should use it when it's still top of mind. Second, very much of people wait until the eleventh hour, so if you consume overly polysyllabic you're fighting the crowds of your fellow procrastinators.

Finally, not to put too dustlike a signal on information technology: Don't store your Groupons under the driver's seat of your railroad car.