Groupon: Reflections of a Business Owner

This morning Russel Kealoha posted on Facebook an interesting article regarding Groupon. I went further and read the blog in her own words.

I can relate to her experience with Groupon and credit her for posting it. Business owners are apprehensive to share mistakes especially in a public forum where we can be criticized as being whinny, unappreciative, and idiotic. After reading some of the comments posted, the blacklash can be overwhelming.

So what do I think about Groupon? It has an upside and a downside. On the up, unlike traditional advertising, I instantly recognized what brought this customer to my store. I’ve gained new customers and awareness of our location. My Yelp reviews, Google Search, and Facebook Page ‘Likes’ have increased. More traffic was directed to my website which led me to update and revise the site. I’ve sold some hard-to-move inventory. I’ve given my customers an opportunity to buy a gift certificate at 50% off.

On the flip side, SWAM is a retailer in a competitive business which solely retails liquor and tobacco. Price margins are very important. Thank goodness for Mom, I don’t have a payroll. Because of our low overhead, we can be competitive with pricing. Competitive pricing means lowering the profit margin. No other liquor store in Hawaii has done a Groupon and that is why. Why did I do it? For the same reasons Posie Cafe did it. I’ve been told Groupon customers will spend more than the Groupon value. After five months in, I don’t agree with that sales pitch. I should have known better when I noticed the shopping habits of my own mother. On a deal, she rarely buys 10% over the minimum purchase. If the coupon states ‘get $10 off on purchase of $30 or more,’ she’ll cleverly buy as much as she can and stay at the minimum. For SWAM, it’s an ‘Ouch’ moment and I’ve experienced many ouch moments.

Another experience is the amount of time spent reconciling the redeemed Groupons. It’s our responsibility to be vigilant on duplicate printed Groupons. Manually imputing the data helps to keep track of spending patterns and outstanding Groupons. So far, I have not witnessed intentional Groupon fraud but I did see duplicates in a customer’s possesion that have been redeemed. I politely reminded them not to use them.

Also, I have not encountered the expired Groupon experience or the impending rush upon its expiration. In Hawaii, there is a gift certificate law that requires a minimum two-year expiration date. Groupon does make clear that once it’s expired, the Groupon can only be redeemed for what you paid.

Fair Warning to all who have outstanding Groupons for SWAM. The expiration date is August 8, 2011 at 8:00pm from then on the Groupon will be worth $10 until August 8, 2013.

Overall, the experience of Groupon was worthwhile. Will I ever have another Groupon or Groupon like promotion? The simple answer is … no.

Category : Blog Posted on June 10, 2011

2 Comments → “Groupon: Reflections of a Business Owner”

  1. NEENZ
    8 years ago


    If I had a coupon for every Groupon that a friend tried to give away to me, I’d be able to fill Mother Hubbard’s cupboard. Hands down, SWAM is our go to for liquor (and cigars, if we smoked them, but will likely just be gifts for Ed!) because of the quality of products and service! 🙂

    • swamwine
      8 years ago

      Mahalo Neenz for the comment! We truely appreciate you reading our blog. Have a great summer!!

Leave a Reply

You must be logged in to post a comment.