What are your thoughts on Groupon or Amazon Local for a sole proprietor for massage therapy?
As one person, I am concerned about too many coupons being sold and lowering the value of what I offer.
Flash sales like Groupon, Living Social, Amazon Local, etc... have historically been less than advantageous for small, local businesses due to the business model. They tend to drive deal-seeking new customers that fail to return or diminish the return on transactions from already loyal customers. That said, there are ways to leverage these opportunities for greater return.
Try testing an offer that requires multiple visits to redeem the full value, such as $5 off each of your next 4 massage sessions rather than $20 an introductory massage. You'll have more opportunity to make a great impression and create loyal customers, not to mention it's far more profitable.
Don't do it unless you want to risk a lot of unhappy clients! Sole proprietors have not had good success with Groupon. It's actually forced some small businesses out of business entirely. Yes, it gets you traffic - but more than you can handle. Many people looking for massage deals only want the best price, they don't want to build a relationship. You need something that will build the relationship - referral offers, incentive points, bonuses for existing customers who refer you out, that sort of thing.
Our suggestion is to opt for a better strategy and a better platform that entails long term branding, profitable sales conversion of costing that you control, versus being dictated at a loss to your business. All of those one-dimensional, antiquated models are a win-lose proposition, with the businesses losing huge margin on below-cost sales, which have to be serviced by high cost labor, materials, inventory etc. No loyalty as the users are largely deal-only users that will never again pay regular value at your establishment, rather another provider that has a current deal. Intelligent customer engagement and values/terms that provide your business with responsible profit margins to empower business health.
I have spoken with several business owners that have used Groupon and they are amazed at the response. They claim that they have been able to retain a fair number of new customers at their normal prices.
On a personal note: I have gone back to several establishments that I first became aware because of Groupon.
You are correct, coupons and price cuts do lower the value of your product/service offering. Groupon is a communication/marketing tool, so it is best used within a wise plan to interact with your target market.
Tell me more about your offering...
As an end-user (or consumer) I tried using Groupon, but it was of no use to me. And then I saw so many business owners use and then complain about Groupon.
Groupon's model is seriously flawed, so say the experts.
Since Massage Therapy is location-based, you'd be better off sending out coupons and marketing materials the old-fashioned way: via direct mail, or by using USPS' Every Door Direct Mail campaign. This way you can keep control on who gets the coupons and how many.
I am not as familiar with Amazon Local as Groupon, so I will comment on Groupon which really has a poor business model for businesses. You have little control over the process. You have to do a huge discount, Groupon controls when the offer starts and stops and worst of all, Groupon gets all the leads out of the deal, not you. They keep the contact info for those taking deals.
You are left with mostly bargain hunters who are unlikely to return and no way to follow up with them. You are better off running your own discount plan with mobile coupons set up with a text messaging campaign. Then you control everything and keep your leads contact info at a much lower cost to set up.
If you do choose to go ahead, the only way businesses actually come out ahead with Groupon is to have a plan in place to up-sell your services to those buying your deal.
My thoughts are about budget airline 'confusion pricing'.
How about bundling a discounted first-time session with an option on 5 or 6 slightly-reduced-price sessions?
I'm not sure how Groupon works, hopefully the first session's discount can still be set to a headline 50% (the figure that I guess people look for), but it only applies to the first session (part of the bundle).
I think you would be better served offering discounts or specials via local channels or your social media accounts instead of paying a portion of your profits to a third party. Also something to keep in mind is whether you want to be known as the "discount" massage therapist.
Perhaps you could do the Groupon with a CAP (Reasonable Quantity) and limit the redemption over a six month period at your discretion so you are not deluged all at once and can squeeze people in to fill voids with mutually agreeable times. I don't know if they would allow this restriction.
One of the comments mentioned social media and I agree. WIth Groupon you are one of many people that do it every week, then of course after the Groupon commission is it really worth your while? Some people in Glasgow, Scotland have encountered many problems as they had such high orders they couldn't cope. They didn't spend enough time on full price customers, so in the end they were busy fools.
I would suggest using Social media and all the channels, offer local promotions and get affiliates onboard to help you. Offer incentives.
Good luck, Louise Wightman
Is the big issue that sites like Groupon charge so much on their fees? What if there was a site where the fees were under 5%? Or is the concern that the influx of customers will be too great? Can't you control how many coupon vouchers are sold?
Small business cannot afford high cost in advertising. It does hurt the profit. However there are some discount deal websites that offer program with flexible discount price decided by merchants, and the commission is only 10% such as eDiscountCity.
you can set a limit per month. and it can be changed later. I did a groupon once and about ready to try it again but changing a few things. here is what I have come up with so far but doing some research to make sure it's what I want.
- just offer 1 massage deal only for the same price as before. The 3 massage is just too hard to keep up with.
-. make sure my phone number and website show up on the groupon itself. a few people were calling the salon instead of me, for whatever reasons.
- I am doing online scheduling and there is a link on my website. the web address is: www ........also, could you mention on the groupon and anywhere else you think best, that I do online scheduling?
- cap at 60 per month - to allow for clients to rebook and other clients besides groupon to get in.
I am a massage therapist. I am the only person in the office. so may concern is too many people redeeming.
Amazon Local is newer and it looks like I would get about 60-80, while Groupon is projecting about 250-300.
I would have to discount my sessions of one hour at 65 by 50% and I would recieve 50% of that. that is a concern. if my book is filled with primarly 16.00 I will go out of business. so I have to have time for my regular clients and referrals.