How local businesses using Groupon are attracting bad reviews?

Businesses using Groupon are attracting fair share of bad reviews along with the customer traffic to their business. The easy come easy go groupon effect has left businesses wondering about the long term usage of groupon and other daily deals sites. Advertising coupons and giving out small coupons to bring returning customers is one thing, but using coupons as the business model for your business is the road to crash course in brain surgery (it is almost a thumb rule in business).

These are some of the papers already published discussing the relationship between online reviews and reviewers who were using daily deal sites like Yelp. Below are sample points from the study


Here are some of the key points from the study

1) Good news! The reviews are real. Most of the people who say the word "Groupon" in their reviews seem to be pissed about their experience.
2) Most businesses get business through Groupon by using attractive coupons that promise the world to the customers for a super low price. Of course, the shiny ads attracted customers, but I think the customers world wasn't as pretty once  they saw what was on the other side of the coupon.
3) It shows how the U.S small business economy responded by  trying to attract customers at any cost. That cost proved to be decrease in customer experience. 
4) Customer acquisition is good for business. But to maintain a healthy competition and a healthy online space, is it good to go to any lengths to get extra customers?

Is your business attracting new customers using groupon? Have you heard of customer retention? Do you know that if you retain all your customers you will always have customers and the cost of acquiring new customers is always high (at least in the long term after Groupon Wave passes)? As opposed to "seasonal" or "pay for hits" marketing,  it is always important to have permanent online assets which will bring you customers in the long run. Such a online building takes time, lot of effort and strategy which sometimes need professional help. KeepCustomer is one such customer retention company that will take care of your entire online strategy and put you in control for permanent success.

Notes: the graph and ideas came from this blog

2 comments:

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