Social coupons — such a deal!

It has always been our prerogative to look for the best deal when we are purchasing anything. It is, after all, the nature of the beast. Those who sell to us have gone through all sorts of creative ways to try to get or maintain our business. Old-fashioned excellent service gave way to sales events, loyalty programs and exclusive sales clubs.

All have had their day, but it is a new day — and the flavour of the day is social coupons.

You have probably seen them or heard about them: Groupon, WagJag, Living Social, — Web-based services that you sign up for in order to be offered the most outrageous, outstanding, unbelievable deals on the planet.  Perhaps I exaggerate; nevertheless, that is the hope.

These services blast out a regular (usually daily) special into our email inbox. Everything from teeth whitening to massages to hair removal to eyeglasses to food specials are offered at exceptional prices.

Right now is the heyday of these services as they race to get the best email list, the best vendor options and the highest close rate.

The business case is fascinating. It is sort of a hybrid of both advertising and sales. To be sure, the margins for the vendor are skinny, very skinny. Most of the services expect you to offer at least 50 per cent off your standard price, then they take another half as their part of the deal. The seller is left with about 25 per cent of the retail value of their offering, a price that precludes most from making a profit. But they are reaching a huge market, and possibly introducing their services to new clients.

But this is where the deals can fall short. If the vendor, because of the thin margins, provides less than excellent service (see the old way of earning customers) they can actually guarantee a client never returns.

Case in point: you will often see massages advertised. I booked a couple’s massage — such a deal! But when it comes time to book the massage it is like trying to get a seat to Hawaii on your Air Canada points! “We are booking four months out” the attendant tells me! Who plans a massage four months out! But I can book a full price one today, just not the coupon massage.

Net result? I may never use the massage, in which case the vendor made out like a bandit. But, and this is a big but, they have lost any opportunity to make me a returning customer.

I had a conversation with the folks at They are a bit more of a regional player than the other social coupon providers. They talk about the importance of customer expectations when they deal with a new offer because poor service reflects not only on the supplier, but on the coupon service as well.


Overall, I still am subscribed to multiple coupons, still searching for that great deal. But I will call the supplier before I buy to find out when I can expect to cash that coupon. If it fits with the time frame I am looking for, great. If not, I’ll wait. There will be another super offer in my inbox tomorrow.

Steve DottoSteve Dotto is Canada’s most respected geek. For over 15 years, as host and executive producer of Dotto Tech, a nationally syndicated TV show, Steve has entertained and educated millions of Canadians on all aspects of technology. Steve has a passion for understanding the social impact of technology. His DVD Cybersafe with Steve Dotto , teaches parents and caregivers about the opportunities, dangers and challenges of social networking.