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Groupon and Social Couponing

Coupon savingsIt’s hip to clip. . . Why do you coupon? Tough times due to the recession, the adrenaline rush when the store actually owes you money for shopping there, or because it’s the smart thing to do? No matter what your reason, there are many ways to clip and save including the traditional Sunday newspaper ads and online resources like Groupon, Scout Mob or Qpon Quties. Although current research shows that more of you are reaching out to the online versions, are options such as Groupon really a viable alternative?

According to a report from Inmar, a coupon transaction processor, the bulk of coupons distributed and more than half of coupon redemptions are still coming from newspaper inserts. However, this is not deterring the online couponers from scouring the web for the latest deals; online coupon access has increased 92 percent and redemption is up 360 percent. It appears that online couponing sites will soon overtake the traditional coupon as preferred way to save. Well, not necessarily. Other research is discovering that resources such as Groupon may be too good to be true.

A study conducted by Rice University’s Jesse H. Jones Graduate School of Business found that 66 percent of the 150 businesses surveyed reported that Groupon promotions are profitable. However, more than 40 percent of the organizations said that they wouldn’t run a Groupon offer again. These findings, coupled with a blog post from the owner of Posie’s Café in Portland reporting that its dealings with Groupon ended with disaster, may spell trouble for the group-buying site. Groupon thinks not.

With the Groupon IPO just around the corner and the site’s value increasing seemingly overnite from $5 Billion to $15 Billion, it seems many folks think social couponing is here to stay.

So, what do you think: Is Groupon here to stay, will something better come along, or will newspaper inserts continue to be the preferred method?