Based in Chicago, Groupon now serves more than 500 cities and 48 countries globally. It is a global ecommerce marketplace, that has numerous merchants who are offering their goods and services, activities, travel trips, and a lot more locally. Customers can purchase deals from these local businesses. It is a great initiative for local businesses to get visibility and to thrive in this competitive business world. The deals offered on Groupon usually start at 50% off and go up to 90% off the regular price in the market. It is famous with small business owners, as Groupon promises the business owners a minimum return on their investment, and exposure to a greater audience. The food and beverage deals are the most popular on Groupon.


Groupon works by selling vouchers and coupons for brick-and-mortar locations, to local customers. The prices that customers avail of these coupons on are much lesser than purchasing from the business directly. The deals offered by Groupon are unbelievable, attracting numerous customers to itself. Recently, Groupon has started working on shifting its business model towards creating better and ongoing relationships with businesses and customers. Thus, they are not offering such heavily discounted deals, but are keen on making Groupon a marketplace.

Groupon attracts countless customers to its website, allowing better brand visibility for a business. Of course, just like any other ecommerce platform, Groupon too charges a fee from these businesses in exchange for brand visibility and recognition. Businesses provide discounted deals and do not earn much from the services they provide, but they get to reach out to an enormous number of customers through Groupon. Thus, Groupon serves as a big advertising platform for businesses, without charging them an additional fee for advertising. Businesses pay Groupon a split of the total revenue earned, usually around 50% of the total revenue earned.

Groupon works with businesses on a revenue share model. When a customer purchases a deal, all the money directly goes to Groupon, and then Groupon distributes the money to the merchants via scheduled payments. However, there have been some cases where Groupon has given a better cut-off to the merchants, but this happens very seldomly.


Before you start with Groupon, you must be well aware of the fact that it is more of an advertisement platform for small and struggling businesses, rather than big well-established businesses. Groupon is completely free for any business to sign-up and posts a deal they would like to offer to their customers. There are certain steps involved in starting with Groupon. These are:

1. Signing up on Groupon as a merchant
By doing so, you would be required to provide a few details regarding your business so that Groupon can help you accordingly.

2. Creating your Groupon campaign
This depends on how many customers you would like to pull in and what is your maximum capacity. You can work on it by using the Groupon Deal Builder or talk to a Groupon representative.

3. Preparing your business and staff
You need to train your staff on how to swiftly deal with the response you receive on Groupon. They should also be trained to market your Groupon deals on other social media platforms.

4. Your campaign’s launch
The day your campaign goes live, you should be ready to receive a large volume of queries and sales. You should be ready to answer these queries promptly.

5. Track your progress
Monitor the insights of your voucher with Groupon Merchant Center to understand your customers better.

The deal you decide to post will have a big impact on how many deals you can sell. Since Groupon is a big competitive platform offering similar deals, customers are looking for the cheapest most option they can avail of. Therefore, you must be very careful in chalking out a deal for your customers. Moreover, you should add restrictions to your deal, such as an expiry date for the promotion, the maximum number of vouchers a customer can purchase, or the total number of vouchers available for all customers.

Instead of offering discounts on products and services, you should offer a predetermined discount on your products and services. This would help you to attract customers who are genuinely interested in purchasing from you, rather than somebody who just wants to avail a deal. Moreover, you should structure your deals in such a way that it encourages customers to purchase from you again, rather than just making it a one-time purchase only.


ROI can be calculated easily on Groupon. The number of vouchers you sell on Groupon should be able to give you an idea about the ROI. One thing to keep in mind is that the merchants do not spend on the advertisements; Groupon, itself, is responsible for the email marketing and marketing on other social media platforms. Thus, no additional costs are paid for advertisements by merchants who are selling on Groupon.


Groupon is considered to be beneficial for small and struggling businesses by providing them that exposure. Some of the pros for using Groupon have been listed below:

1. Better exposure for your business
We all want to avail good discounts, therefore, customers look out for places that provide goods and service at a cheaper price. Customers who use Groupon will get to know about your business if you post up a deal on Groupon. It is a big and famous platform that provides your business the visibility it needs to do good.

2. Attract more customers
Groupon is a place where amazing discounts are provided. The deals you provide will help you to attract more customers than usual.

3. Clear your inventory
Provide discounts on those products and services that are not purchased that frequently. By offering those goods at a much-discounted price, you will do some business on them.

4. Incremental revenue
A Groupon voucher can help generate extra revenue for those businesses that run on a low-cost or fixed-cost structure.

5. Build relationships with customers
Use your deals in a way to help build relationships with your customers.


Just like any other ecommerce platform, Groupon too has some cons for businesses. These cons include the following:

1. Damage to your image
Deals make customers habitual of paying for goods and services at a discounted price. This makes them less likely to pay full price for the products and services you offer.

2. You do not get loyalty
With Groupon, you are very less likely to get repeat customers. The customer purchased a voucher from you because they got tempted by the price and not by your brand.

3. Groupon is not profitable
The deals you post on Groupon are already at such a discounted rate. In addition to this, Groupon takes half of your revenue, leaving you with no profit margin.

4. Too much competition
Groupon is an ecommerce platform where almost all brands are offering the same products and services. The customers try to get a voucher from that merchant whose rates are the lowest amongst the whole lot.


If you are a business that is struggling to get customers, then try your luck on Groupon would not be a bad idea. At least you would end up getting some customers to serve, who can turn into your permanent customers. Moreover, Groupon would be a good platform for creating brand awareness and visibility amongst Groupon customers. Singing up for Groupon is no harm as it is completely free. The best part about selling on Groupon is that there are no additional costs paid by merchants for advertisements, until and unless the merchant wants to do it on their own.

However, if you are already a well-established business, you must steer clear of Groupon, as it could damage your brand image. A well-established business should work on its marketing strategies that could help them to get a higher ROI. Any goals that you have in mind can easily be achieved if you work with the right people. DigAptics is a team of professionals, who work tirelessly with their clients, to help them achieve their desired goals. Whatever goals you have in mind, feel free to discuss them with these dedicated professionals. Contact them today to get a free estimate for your business.


Groupon can be the only option a merchant can have if they are struggling to pay for the marketing for their business. It is a big American ecommerce platform that allows various businesses to gain popularity and visibility. If you are striving hard to gain customers for your business, then you can give Groupon a fair shot and see where you land. You do not have anything to lose here if you are a small business trying to gain customers. However, if you a big or medium-sized business, and are doing good, then you should work on your marketing game to get more clients.



Author Digaptics

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