Group buying websites

Some of the best consumer bargains can be found online through coupon websites. CHOICE finds out which ones are worth logging on to.
 
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01 .How they work

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If you want a bargain (who doesn't?), forget loyalty cards or waiting for the sales. Group buying websites offer daily discount coupons for a variety of services – everything from go-kart sessions and massages to theatre productions and cool restaurants and bars. We set out to find out whether the offers are genuine and the good news is, they are. Be quick to make a booking for the services - especially for smaller businesses - to ensure you’re ahead of the queue. 


 

How do online coupons websites work?

Generally, an online coupon website will offer a new deal every day, for one or two days only. The companies operating the sites use the power of group- or bulk-buying to negotiate big discounts with retailers, and receive a commission for the number of coupons sold online. When a new offer is published online, it will only be made available after a minimum number of subscribers sign up to buy – if they don’t, the deal does not happen.

The deal ends when the coupons are sold out or the time limit expires. After you’ve paid for the coupons, they’re emailed to you so you can print them out and redeem at the retailers’. You can sign up to receive daily offers in your email inbox, Facebook and/or Twitter accounts. CHOICE member Naomi Nixon believes she’s saved about $400 in beauty and spa services since she first jumped onto these sites. Another member, Jo Randell, says she’s bought a few discount coupons and has had “positive experiences with all of them so far. In fact, I’ve discovered a new great hairdresser.”  Some sites also offer more than one deal a day (see CHOICE Recommended Sites), and allow you to suggest deals from particular retailers. 

The power of social media

Online coupon website operators rely heavily on social media networks such as Facebook and Twitter to drive sales. The size of their subscriber database – the bigger the better – helps the website operators  negotiate discounts with various retailers who may otherwise spend on media advertising. Some websites also give credits to shoppers to encourage them to spread the word to their friends and encourage  purchases. “Consumers get the chance to try something new at big discounts,” says general manager of Scoopon, Jon Beros. “Retailers provide the discounts as they benefit – in a very short time – from pre-paid sales, exposure to their products and services and the chance to build repeat business. It’s a win-win situation.”

Can you be sure the bargains are genuine?

MySkin Laser Clinic in Melbourne offered a deal through Scoopon, where $79 bought a voucher for laser hair removal deals to the value of $500 – an 84% discount. More than a thousand people bought the vouchers, locking in three months’ worth of business for the clinic. “We publish a list of the usual prices for the different types of treatment, so that voucher-buyers are clear about the value they are getting,” the clinic’s director, Chris Ohanian, told CHOICE. “Given a lot of the coupons are for services rather than products, it’s not really possible to know whether their claim of original value is correct – but that’s fine by me so long as I’m happy with the price I’m paying,” says CHOICE member, Marta Pearce.

Too good to be true?

Online coupon websites certainly offer great bargains – but as always, there are some hitches to watch out for. “Consumers should be mindful that the discount might be an exaggeration, as well as the terms and conditions attached,” says Christopher Zinn, CHOICE Director of Communications and Campaigns. CHOICE member Jon Park, who purchased six coupons for go-karting, was miffed when he could not use the vouchers on the day he wanted. “I was told by the go-kart operator that voucher-holders weren’t given priority over full-paying customers. This wasn’t stated as part of the terms and conditions of purchase. I believe this is very unfair and unjust.”

Another member, Dave Gardner, warns: “I purchased a voucher from Spreets for two dozen cupcakes from Kustom Cupcakes with a special occasion in mind. The voucher’s terms and conditions stated that I needed to pre-order the cupcakes with 24 hours’ notice, which I did. But Kustom Cupcakes then came back and said they were fully booked this weekend and couldn’t accept my order. I explained that the cupcakes  weren’t useful to me any other time, but to no avail.”

When contacted for comment, Spreets’ chief executive officer, Dean McEnvoy, told CHOICE: “We will facilitate a refund directly from the business to the consumer and if they aren’t co-operative we will refund the consumer first and chase the business for the money. Most of the time it’s a misunderstanding or the business is a little inundated in the first days after a deal sells.” Another drawback of online coupon websites is that while the majority list all the major Australian cities, most of their offers are concentrated in Sydney and Melbourne. Sales people at the business for which you buy a coupon may also be pushy in upselling other products and packages to you.

 
 

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Tips to using online coupons

  • Create a separate email account when subscribing to the online coupons websites to avoid cluttering your regular inbox.
  • If you missed out on an offer from a national retailer in your state, check if it’s still available in others. We managed to buy Hoyts movie tickets at half-price on Scoopon's Adelaide site to use in Sydney Hoyts cinemas after the offer had expired in Sydney.
  • Check the fine print such as expiry dates and compulsory advance booking requirements. Be sure to book early, especially for smaller businesses or/and when a big group of people have bought the offer. You don't want to be in a six-month queue for a hair cut.
  • Google “coupon”, “discount” or “promo code” along with relevant key words if the bargains you’re looking for are not explicitly featured on the coupon website (for example, airline tickets and holiday accommodation deals).
  • Check out www.entertainmentbook.com.au, a local restaurant and activity guide costing between $50-$65 that offers up to 50% off restaurants, entertainment outlets and hotels throughout Australia and New Zealand. Entertainment Books are charity fundraisers and are only available through fund-raising groups and organisations.
  • Look for sites offering restaurant and travel discount coupons that you can print and redeem without having to sign up to a website or buy vouchers, such as www.hotdockets.com.au and www.offerme.com.au.

We checked out many group buying websites and found those worth logging onto:

  • allthedeals.com.au is Australia’s daily and weekly deals tracker from services to products. A very useful site to bookmark.
  • cudo.com.au is a joint venture between Microsoft and local media corporation PBL, but hasn't featured as many offers compared to the other sites as it was launched only in September. However, the deals hosted are definitely solid bargains, such as $69 for gold class seats at the Ben Hur live show in Sydney (originally priced at $159), or a $20 voucher for $60 worth of food at an Italian restaurant in Fitzroy, Melbourne.
  • jumponit.com’s holiday accommodation deals are few and far between, but its massive travel discounts off the regular cost makes this site worth signing up for. In October, the site hosted a $149 coupon for two nights’ accommodation, breakfast, massage and facial at a hotel in the Blue Mountains (packaged originally priced at $450). Jump On It is also extending its reach to Auckland and Johannesburg, so if you’re thinking ofheading to these destinations, check out this site for more details.
  • ouffer.com.au also offers deals ranging from restaurants to spas and goes the extra mile with a valuable discussion forum where shoppers can post questions and receive answers about the vouchers they’ve bought on the site, as well as provide feedback about the experiences – positive and negative. Shoppers are also able to use the forum to sell their vouchers.
  • ourdeal.com.au has an even spread of deals - everything from fitness and restaurants to to paintball, scuba diving and spa packages – with at least 50% slashed off the usual prices. The site also offers up to three additional or side offers per day.
  • scoopon.com.au is a spinoff from local product bargain site Catch of the Day and with half a million subscribers, has the largest database among the coupon websites. It has offered some very good deals including $2 burgers and a buffet with unlimited beer, wine and soft drinks onboard a harbour cruiser for $50 (original price $110). The site also has an iPhone App you can download for free to access Scoopon.
  • spreets.com.au offers lots of premium beauty and spa deals but offers gems too such as its more than 50% discount off tickets to the musical, Fame, in Sydney and $55 (originally priced at $110) for a five-hour fishing trip in Port Phillip Bay, Victoria.
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