When Jessie Burke refused to honor an expired Groupon coupon for a longtime customer, a woman named Lucinda, who wanted a bite to eat in Burke's Portland, Oregon, cafe, Lucinda threatened to never return -- until, that is, Burke sat down with her and explained the trials and tribulations of a small business working with the behemoth coupon company.
Her story isn't a pretty one.
In her conversation with Lucinda, and, again in an open letter on her Posies Cafe website, Burke admits that she accepts full responsibility for running a Groupon campaign, but the result of her decision, which was made, she says, after some fast-talking from a Groupon rep, sunk her $8,000 in the hole, the sum of which she had to pull from her personal savings account in order to cover payroll and rent. And that's just the half of it. She also writes:
At the same time we met many, many terrible Groupon customers... customers that didn't follow the Groupon rules and used multiple Groupons for single transactions, and argued with you about it with disgusted looks on their faces, or who tipped based on what they owed (10% of $0 is zero dollars, so tossing in a dime was them being generous). Or how about the lady that came in the day of Groupon (though you're not technically allowed to use them until the day after) and asked for the Groupon discount without an actual Groupon in hand because she preferred to give us all $6 rather than half of it to Groupon.
If you like this story, consider signing up for our email newsletters.
SHOW ME HOW
You have successfully signed up for your selected newsletter(s) - please keep an eye on your mailbox, we're movin' in!
The Groupon deal that Burke was offering entitled guests to receive $13 worth of product for $6, because, she was told by the Groupon rep, "people really respond to deals that are over a 50% discount." When she and the rep spoke about percentage splits, she was informed that "when the consumer pays less than $10, Groupon usually takes 100% of the money." Holy shit! But he assured her that most customers would cough up more than $13.
Burke offered the Groupon coupon for six months, and now says that the only saving grace is that it had an expiration date.
Burke's story is certainly food for thought, so we ask: As a restaurant, have you also lost money using Groupon coupons? And, as a customer who's bought restaurant Groupon coupons, will you continue to do so knowing that it can potentially wreak havoc on independent restaurants?