Groupon and Small Business

Ever since Groupon became a hit among consumers looking for deals, small business owners have been weighing the pros and cons of the coupon service.  According to a recent survey, it looks like most small business owners have decided that Groupon is NOT a beneficial phenomenon for businesses. 

iContact, a social media marketer, polled small businesses and an astounding 70% of respondents reported “hating” Groupon.

 There are several reasons the popularity of Groupon is not a favorable trend for small businesses, but two are especially hazardous.  First of all many companies find they lose money when they offer Groupon deals, specifically businesses that have low marginal costs and high fixed costs. Also offering your product or service for a discount can devalue the image consumers have of your business. 

Groupon and other coupon services are popular and can be a great way to market you business, but the services also have their downfalls.  Does your small business use or would consider using Groupon?

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Posted on November 28, 2011, in Uncategorized. Bookmark the permalink. Leave a comment.

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