Be Careful Before You Use Groupon
January 28, 2015My boss is a big fan of Groupon.For those of you not familiar with Groupon, it falls into a category of online commerce sometimes called “deal-of-the-day” websites. There are several of these out there, including LivingSocial and Woot, and they all pretty much offer deep discounts on a variety of goods and services. My brother was the first person I actually knew who used Groupon to buy $25 worth of food at a local restaurant for $15. Knowing how careful my brother is before he tries things, if he’s used it and it worked, then it must be legitimate.
My first experience using Groupon was last year when I bought a fishing trip for me and my son. My prior trip cost about $250 so when I saw the “Groupon” for $99, I thought it was a pretty good deal. It was, and we both enjoyed the fishing trip. Since then, my wife and I have used Groupon several times for things like putt-putt at the local mall and girl’s night out at a dinner-and-a-movie cinema.
My most recent transaction, however, has suddenly given me reason for pause. As you might expect, websites like Groupon work well in our media-rich environment, and so they all send emails frequently touting current offers. We received a recent email offering $40 worth of printer ink for $15.
Now if you know anything about printer ink, it’s that it can be rather expensive, and I just so happened to be in the market for more ink so when I saw this “deal” I did what Groupon wanted me to do: I purchased it. I purchased three, in fact, because it seemed like a really good deal. It was only after I received the Groupon vouchers that I discovered that what seemed like such a good deal at the time may not have been such a great deal after all. Here are a few lessons I learned from this particular Groupon experience:
1) Check out the prices of the company offering the deal BEFORE you take advantage of the offer.
I was so excited about the size of the discount that I didn’t bother to actually look at the prices on the company’s website. I figured that printer ink was such a commodity that it would be hard to sell it online for an unreasonable price. Apparently, I was wrong.
The company is selling one cartridge of ink for $66. I can buy it directly from the manufacturer for $41. Is there any wonder why this company is offering such a “good” deal?
2) Calculate the NET cost.
Even with the higher prices, it may have still been a better deal so I did some math. If I apply a $40 voucher to a $66 purchase, it costs $26. That sounds pretty good, but remember, I paid $15 for the voucher. Adding in the $15 brings the total cost up to $41 (hmmm, interesting), and to add insult to injury, I would have to buy $9 more worth of stuff to get free shipping. Otherwise, I would have to pay an additional $6, making the net total cost $47…so much for a bargain.
3) Read the fine print.
The company did offer better prices on bundles (e.g., purchasing three black cartridges and two color cartridges) and other items, but I could only apply the voucher to re-manufactured items so if I wanted to buy original items, I could NOT use the vouchers. It’s a good thing I don’t mind buying re-manufactured items.
4) Know the expiration date.
Most of the Groupons I’ve used in the past expired one year from the date of purchase, but this particular voucher expires in 90 days. That wouldn’t be such a problem if I had purchased only one voucher. After all, I did say that I was in the market for printer ink, but I bought three vouchers thinking that I’d be able to buy ink over the course of the year. As such, I’m going to have to buy cartridges that may sit on the shelf for a while.
5) When in doubt, call the offering company.
With all of the trouble I mentioned above, all could be salvaged if I were able to apply multiple vouchers to a single order, but the company’s website does not allow me to do that. I’ve attempted to call the customer service number only to get a busy signal. This would have been a red flag had I bothered to do my homework.
6) Shop around.
This should have been the first thing I did, but I acted in haste. The truth is I can buy similar products for a fraction of the cost on other sites. For example, a $26 re-manufactured ink cartridge from the company offering the Groupon can be purchased for $12 on another site without any coupons.
Please don’t get me wrong. I’m not suggesting that Groupon is a bad thing, but just because something looks like a “good” deal doesn’t mean it is. It’s up to me the consumer to know whether or not the “deal” that is being offered is actually good.
Don’t get caught making the same mistakes I made. Learn how to spot the really good deals from the phony ones. Then you can tweet all your Twitter followers on how sweet a deal you really got!