Is Groupon in the Gift Card Business? Do they sell Coupons? Maybe Groupon is trafficking in Gift Cards.

Do you care which discount-providing item Groupon sells? To my dismay, some people are starting to debate the idea, apparently with the goal of compelling Groupon to make the amazing deals they offers never expire.

Talk about Perception Being Reality (and I have, several times; my most recent “Perception is Reality” post is here)!

If you’ve somehow missed it, even among the recent news that they had turned down an offer to be acquired by Google for $6 Billion, Groupon is a website offering some pretty amazing deals each day. The discounts are huge, the deals expire, and so does your window to use the deals, which you pay for before you use them. It’s “like” buying a gift card.

Problem is, there are laws that govern gift card expiration. So if Groupon is selling those, then in many places they can’t expire.

Are They?

Perception is Reality, and I’m not an attorney. Let’s approach this from a pure customer service perspective.

Groupon, of course would claim that they aren’t selling “gift cards” at all, if only to avoid the legal issues. They might believe they’re selling coupons, which can expire. They might even believe they’ve come up with an entirely new category of customer service/discounting vehicle.

But ask yourself a question: should it matter?

Like millions of people, I regularly receive coupons in the mail from Bed Bath and Beyond. The coupons have clear expiration dates printed on them. And while I don’t believe this to be their official policy, Bed Bath and Beyond honors coupons even if they’ve expired.

They don’t have to do that, and I don’t think too many people would storm out of their local Bed Bath and Beyond never to return if they were told they they were trying to use expired coupons. Bed Bath and Beyond has simply decided to skirt this perception/reality issue (or create a greater perception and reality) by providing superb customer service. Why would you tell a customer that you wanted their business under certain conditions yesterday, but that you think less of their business today?

There might be an answer to that, along the lines of “my business is successful enough now that I no longer need to  ‘buy’ business“, but that isn’t the mechanism behind coupon expiration dates. Coupons expire to create a sense of urgency in buyers; if you already have someone’s money, there’s no need for an expiration date in that regard.

There’s also no “accounting” issue. You book the income as soon as you collect the money.

So this can be a pure customer service conversation. Groupon and its partners don’t have to apply those expiration dates. Groupon customers just need for their perception to include the reality that the businesses from which they buy Groupon deals might not be able to accommodate them easily farther down the road, or might even have gone out of business if the coupons are held for too long a period. But frankly, those realities apply even when you use a Groupon coupon during a stated pre-expiration period.

See? Perception is reality. All you need to do to create excellent customer service is . . . everything.

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