I'll confirm the sales model, my mother runs an (awesome) coffee shop in Abbotsford, British Columbia, "Chapleos" - and she routinely gets a call from her Groupon Rep. I suspect that their direct sales staff are incented to contact small business, and update the database on them. To some degree, the principal assets of Groupon are (A) their Brand, (B) their Mailing list, (C) their direct sales force, and (D) That database of business which will soon, if not already, be the finest database of businesses in the world.
Both Yelp/Google have an issue with their data freshness on business. I'm constantly updating open/close times, (and even whether a business exists) on Yelp. And business (particular taxicabs) have long ago figured out how to Game Googles Small Business directory to get in fake listings.
It will be interesting to see what they do with their database.
A funny example of how local merchants try to game Yelp: Plumbers and the like will frequently try to update a competitor's phone number to their own. This is hard to police without calling the merchant.
A have a friend who used to verify these listing changes for Yelp -- but it's all been outsourced to Indian now. Who knows if that will effect quality.
I find particular amusement and disgust with the local merchants who blatantly rate their own services with 5 stars from an account that clearly belongs to them.
I'm no fan of Groupon, but by not having user-submitted reviews (AFAIAA) they avoid the issues Yelp runs into by trying to please both businesses and users.
Both Yelp/Google have an issue with their data freshness on business. I'm constantly updating open/close times, (and even whether a business exists) on Yelp. And business (particular taxicabs) have long ago figured out how to Game Googles Small Business directory to get in fake listings.
It will be interesting to see what they do with their database.