It’s easily the most effective way to get hundreds or even thousands of people through the door of a business with one day’s advertising. The problem is that the cost of sale doesn’t really add up for the business owner.
Here is an example :
Generally a beauty salon only needs to convert about 10% of Groupon buyers into regular clients for it to make financial sense but based on data we’re only seeing conversion rates of about 1%. Think about that for a second. A salon with three staff sells a thousand deals and only ten of these come back again and pay normal prices.
That’s over a thousand man hours (at least two months) of loss-making treatments to gain seven new clients.
Groupon have been cold calling some of our clients - so be aware not everything is always what it seems, check your market. If it seems to good to be true - you know the rest !
