Groupon and Living Social, a let down? Big surprise.

I got a call from Living Social yesterday. I told them though I was booked solid until at least the end of September. They said they needed someone now though.
 
I guess I should say there is one upside to Groupon and Living Social. When other cleaners in my area are using them they are taking up their time with low paying work so I can use my time on the profitable jobs.
 
mistersqueegee said:
I guess I should say there is one upside to Groupon and Living Social. When other cleaners in my area are using them they are taking up their time with low paying work so I can use my time on the profitable jobs.
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What does your competitors jobs have to do with yours? If their working on profitable jobs are you not still doing the same?
Just trying to understand your comment.
 
Johnson said:
What does your competitors jobs have to do with yours? If their working on profitable jobs are you not still doing the same?
Just trying to understand your comment.
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I mean if they are swamped with low paying Groupon jobs then there are more good paying customers needing service and I'll have the time to take care of them while the others won't.
 
One of my closest friends who also happens to be a competitor did a Groupon last year. In general it was a horrible experience for him. He sold 150 deals. Regular price was $199 for exterior softwash up to 1800 SQF. Additional square footage ( 10 cent per foot) , concrete, decks, , etc were all an up-charge. Deal was sold at $99, so he got $60 per deal.

Quickly realized that the coupon shoppers were in general very cheap. Was able to upsell/upgrade very, very few customers. If fact even had several larger homes that had purchased the deal and the buyers would only allow him to clean the front side of the home, since it fell above the 1800 SQF maximum, rather than pay a few extra dollars and get the whole house cleaned.

Here were the positives:
1) May keep 10-15 % of the customers as repeats
2) Had 15% of buyers not claim their voucher, so he was paid for those, even though he did not do the work.
3) It brought him HUGE SEO juice.

It was a huge pain and he'll never do it again!
 
Wow 150 deals. thats a royal pia if you do not upsell all the clients. you just confirmed what i was asking myself, will they spend more? nope.

They offered me a deal $99 house wash up to 1500 sq. feet. $50 gutter cleaning ( just remove the stuff ) and $50 6x9 deck wash. just wash. any combination. groupon would keep 50% of total sales, after 2.5% was taken of the top for cc fees.


I think it can be done IF upselling was good. but they are on ther computer getting these deals for a reason. i won't try it.
 
I was told when I did my deal that I would keep 50% of the price but it would be sent to me in 3 payments, 1 each month.

Not sure if they told him different or if they are making up the rules as they go.

I would not do it again, they screwed up the whole thing and ran it at the wrong time so it just failed each way possible.
 
Johnson said:
What does your competitors jobs have to do with yours? If their working on profitable jobs are you not still doing the same?
Just trying to understand your comment.
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That would be because the competitors are losing money by getting jammed up with these groupon, living social deals. Unless you know what you're doing you'll lose your butt doing work for 30 to 50% of what you would normally charge.
 
Guy Blackmon said:
That would be because the competitors are losing money by getting jammed up with these groupon, living social deals. Unless you know what you're doing you'll lose your butt doing work for 30 to 50% of what you would normally charge.
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And if you do know what you're doing..........?
(Just asking.)
 
Christopher said:
I was told when I did my deal that I would keep 50% of the price but it would be sent to me in 3 payments, 1 each month.

Not sure if they told him different or if they are making up the rules as they go.

I would not do it again, they screwed up the whole thing and ran it at the wrong time so it just failed each way possible.
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He got 60 %, this was a year ago. The three payment system was the same, though. The large cash infusion did help him a little bit, so I guess you could call that a positive....
 
I just did one 2 weeks ago. Sold 15, it was a good experience and I would definately do it again.
 
Seems curious that they are getting the money up front, but want to pay in installments. Also, them keeping 50% of the sales seems like a ridiculously high percentage, particularly since there really is no cost to their marketing.
 
Scott Stone said:
Seems curious that they are getting the money up front, but want to pay in installments. Also, them keeping 50% of the sales seems like a ridiculously high percentage, particularly since there really is no cost to their marketing.
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50% was the deal breaker. It would work if every house i got was 2800 sq foot and had a 12x 30 deck and i upsold those every time. but i doubt that that will happen
 
Gary Mauer said:
And if you do know what you're doing..........?
(Just asking.)
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Gary, just look at this post, much info here to determine a course of action if this is something contractors are thinking about.

Honestly I shouldn't say anything seeing that I will never use these types of deals. The profit margins are just not there. The thought of giving 50% of a regular price to someone else is completely ridiculous, plus I don't need that kind of work that bad.
 
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