These daily deal sites can work out great for merchants sometimes. It's not all doom and gloom. An example is described here: http://www.kuow.org/program.php?id=23711
Briefly, a small auto shop offered a $30 oil change for $10 via Groupon. The owner expected to get about 90 takers. He got 2277. He had to hire more staff and buy a second car lift to deal with them all. It took months, and he lost money on the oil changes--but about half of them became regular customers and that made up for the loss and put him overall way ahead.
They also profile a restaurant whose experience (with Living Social) was not good. Their deal was disastrous.
If you compare the two deals, and the nature of the two businesses and the psychology of their typical customers, it makes sense that the auto shop worked out well and the restaurant did not.
Briefly, a small auto shop offered a $30 oil change for $10 via Groupon. The owner expected to get about 90 takers. He got 2277. He had to hire more staff and buy a second car lift to deal with them all. It took months, and he lost money on the oil changes--but about half of them became regular customers and that made up for the loss and put him overall way ahead.
They also profile a restaurant whose experience (with Living Social) was not good. Their deal was disastrous.
If you compare the two deals, and the nature of the two businesses and the psychology of their typical customers, it makes sense that the auto shop worked out well and the restaurant did not.