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It was the last straw.

I stared at the pleasant and vibrant green and white packaging on my “refurbished” Jawbone. Fresh from Groupon, it refused to function. After dropping a meager $50 or so on outdated Jawbones for myself and Mr. Picky Pincher, I made a vow.

Never again, Groupon. Never again.

Of course, I went running back. In two months I was using Groupons again. And swearing profusely.

Are Groupons a good deal, or are they a gnarly frugal enemy?

Are Groupons Worth It for Customers?

I gotta hand it to Groupon.

They’re masters at luring in customers with promises of 50% off deals on anything you can think of. Want to go indoor skydiving or learn bead-making? There’s a Groupon for it! And even if you discover bead-making isn’t your thing, who cares?! You paid $15 to try it out, no harm done. Sounds like a lot of fun, right?

I was a Groupon customer for four years.

Or rather, it would be more accurate to say I was in a bad relationship with Groupon for four years. They would piss me off, I would leave them, and they would reel me back in by whispering sweet sales in my ear.

Over and over.

As a customer, a Groupon could be a great deal. I spent $15 on a 4-hour class that taught me how to crochet. I was able to apply those skills and make hats and scarves for my family for Christmas, which saved me a lot of money. I also got Groupons for Zumba classes around town to try out new gyms for pennies. $20 for two months of unlimited Zumba classes? Why yes, thank you.

I even ordered bedding for both of our beds from Groupon Goods, which I was and am still pretty satisfied with.

On the other hand, I’ve had my fair share of Groupon flops.

I mistakenly signed up for a bead-making class that only met on Tuesdays at 10 am. That’s great, but if you have a job it’s a touch inconvenient. While that was totally my bad, the refund experience was an absolute nightmare.

The same goes for a facial I paid for; I finally just gave it to a friend out of pure frustration. Some of the Groupon Goods, like the Jawbone, have been absolutely disappointing and low quality. One of the Zumba gyms turned out to be absolutely awful, but I had already paid for two months of classes, and was stuck there.

My negative experiences with Groupon varied. Sometimes I had an issue with Groupon’s policies (gotta read that fine, fine print) and sometimes it was the vendors themselves.

Everyone’s experience will be different depending on where they are and what they buy.

So the bottom line here: Groupons can be worth it if you always read the fine print and are very careful about the Goods you buy.

Why Groupons are Bad for Small Businesses

I’m concerned with Groupon beyond their spotty quality.

The main issue is that Groupon is bad for small businesses. Many businesses say Groupon is a great way to get people in the door, which can be true. I once tried to get an oil change with a Groupon and the mechanics couldn’t pencil me in for three weeks! Talk about busy.

But there’s a problem with the nature of Groupons and the people who purchase them.

Groupon users are focused on deals.

They sign up for, say, a haircut through the deal site for $5. They pay their $5 (with no tip) and never return to the small business again. The customers are typically focused on saving money right now. It’s not always about finding a great new salon, like businesses hope.

As an avid former Grouponer, I’m guilty of this. I got highlights done for $20 and didn’t tip–even though I now realize I definitely should have, especially since the lady did a fantastic job. I would only dine at a restaurant when a Groupon was available for the meal. I would never sign up for a Zumba gym membership, defaulting to commitment-free and affordable Groupons instead.

But this “cheap cheap cheap” approach that consumers adopt is hurting small businesses. If we take advantage of promotional pricing and don’t become repeat customers, we’re bleeding these businesses dry.

The Bottom Line

Groupons encourage consumption. Just like coupons, Groupons encourage customers to buy services and products they don’t need in order to feel a perceived hole in their lives. Groupon is also notoriously difficult to deal with, and the product or service quality is often lacking. The focus on finding the best deals leads to struggles for small businesses. Groupons are creating a cycle of over-consumption and a strangulation of local commerce. Decent deals are a diamond in the rough; in general I recommend staying away.

We want to know: Have you tried Groupons?

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