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There are two different discussions going on right now on the ABMP and Massage Mag LinkedIn groups regarding Groupon. If you don’t know what Groupon is, check it out at www.groupon.com.

I’m not here to advocate the use of Groupon or steer you away from it.  I just know that services like this are being used by therapist with varying results. Therefore, I felt it important to open up the discussion so we can all learn more about this promotional concept from those that have used it.

Allow me to weigh in first with some input based on my observations of some of the experiences our clients and prospective clients are having:

A)     “My phone is ringing off the hook!” (This is what we are hearing from prospective clients calling looking for a solution to deal with their crazy call volume).

It seems that the response you can get from running a Groupon promotion can be very high (200 to 1200 Groupons sold in a day). Which means: That once your Groupon (coupon) is posted you can expect a flood of calls coming in. Not being prepared to absorb the increased call volume can create a problem.

B)      “All I am doing is discounted appointments!”

The other issue that I see happening is if you do not limit the times when someone can us their Groupon, you can end up giving $18 one hour massage (a $60 massage offered at $30 and then the 40% Groupon fee taken out) until  you fade off into the sunset.

Offering the ability to allow clients to schedule online and then having the criteria that all Groupons must be scheduled by the client online, can resolve ‘A’. Limiting their ability to only schedule on certain times on certain days can resolve ‘B’. We have a client that only allows two appointments per shift for 9 out of his 16 therapists to be scheduled with a Groupon. The calendars for these 9 therapists have Groupon appointments booked almost to the end of the year.

That's all I know. So please share your Groupon experience if you have one. Hopefully the folks on LinkedIn that have shared their experiences there will jump in here.

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We have enrolled our 3 NYC spas in a new service called B-Treated.

 

This is more like Hotwire or Last-Minute Deals than Groupon since you are selling a specific service at a specific time instead of a voucher for a service over a long period of time.

 

Though the economics are better than Groupon and the like (they only take 15% of th sale price, and that includes them processing the credit card) the biggest value is being able to use slack time for my staff to help fill their book.

 

This has prevented me from having to pay therapists and hourly rate for standing around -- instead they are generating service fees for themselves, and $10 - $15 for me.

 

Busier therapists = lower turnover, and a few of the folks have purchased products which makes them decently profitable customers.

 

Will never do Groupon or anything that leaves me with less than 50% of list price, but I post on B-Treated every day.

Groupon is a great idea. My volume has increased. I am able to meet more clients in one week than spending the money on advertising and not knowing if clients are even seeing th ad. The only issue is that they take 50% of the money. So technically im only taking in 25% of the full price that i charge. Then again its the best way to advertise right now. Other companies are doing the same thing and you can take more money home. Just look around. We are planning on being a merchant partner by summer. I have learned alot about what to do and what not to do for groupon in the last year.

Hi Rhonda!

My studio is currently a merchant partner with Groupon and we have had unbelievable success with it. Would love to connect with you to talk about your experiences with it and what I am planning for our expansion due to our volume.

rhonda l. douglas-larkins said:

Groupon is a great idea. My volume has increased. I am able to meet more clients in one week than spending the money on advertising and not knowing if clients are even seeing th ad. The only issue is that they take 50% of the money. So technically im only taking in 25% of the full price that i charge. Then again its the best way to advertise right now. Other companies are doing the same thing and you can take more money home. Just look around. We are planning on being a merchant partner by summer. I have learned alot about what to do and what not to do for groupon in the last year.

I am a sole practitioner who ran a Groupon.  There is a lot of good advice on here - make sure you do your homework before deciding on an offer. I thought Groupon did a good job in making the process easy and they were good to work with.  I made sure I had a maximum set, and we extended the typical expiration date so the buyers could come in when they wished and I wasn't crushed all at once.

 

I have run into two main groups of clients from the offer.  The first is the discount shoppers who bought it because it was cheap and won't be back - they will just wait for the next discount massage offer.  The second is people who had a therapist they liked a lot, but due to one party moving or some situation change, they are looking for somebody else that they like a lot. So in that sense it was a good offer since it was free to be on Groupon, and the client could try me out with less at risk.  I also have quite a few who had never had a massage before and were willing to try it at a discount, so that was good exposure also.

 

The main result I wanted from Groupon was to add long term clients. Although people are leaving happy with my work, the return percentage is lower than I would like.  I have offered discounts for future sessions, but most say they need to look at their schedule and don't want to book again as they are leaving. 

 

By the way, once I was on Groupon, everybody else who does discounts in the area started calling me.  I haven't done another, since I don't want people to think they can always get a big discount from me and never come in at close to full price.

 

I experienced a spike in the first month, and following months have been pretty consistent.  Based on that, I am expecting a good number who bought it won't use it before the expiration date, so I can charge the difference (or give them a discount if I wish) for those who use it later.

 

 

My article about this appeared in Massage & Bodywork Magazine, which you can read for free in its entirety online.

I interviewed a lot of therapists who had done Groupon and Living Social and they were all thrilled with their results. And just about five minutes ago, I saw a therapist on FB who was offering to honor the coupons from other therapists.

David Turner, a therapist I know in Charlotte NC, and who I quote in the article, sold over 700 Groupons in 24 hours, which led to his moving to a bigger office and hiring additional therapists to meet the demand.

Most of the people who did a Groupon stated that they were initially worried about people just getting the discount and never coming back, but it hasn't happened that way; they have gained a lot of repeat clients (at full price) just for introducing them to their services.

I live in a rural town and Groupon isn't available except in larger markets so I haven't personally done it.

Oh, I would consider doing another offer, but I would want some changes - like a better deal from the company.  I just don't want to perpetually have a huge discount offer out there.  It was good exposure and it brought in typically a younger client than what I had been seeing.  I'm trying now to determine how to make them repeat, long-term clients.

Ezekiel OBrien said:

Barry sounds like you are done with the Groupon like sites.  However, one of the massage therapists I know who did both a Groupon and a Living Social has been able to negotiate for a higher cut with some of the smaller sites.  So upward negotiation is available when you are bargaining from a position of power with these sites.

Groupon just came to my area and they keep calling me to run a deal with them. But I haven't made a final decision yet because I have been working with The Local Deal and I have been getting a great group of clients from them.

 

My personal feeling on how to make this type of marketing effective is you need to offer a specific type of treatment. If you just offer a generic massage you are more likely to get a lot of tire kickers. The deals I have run are only for craniosacral therapy and Myofascial release. And running a deal like this has increase repeat business. 

I did a Groupon this past January. I did ok. 227 Groupon deals at about 28% of the original price I charge for the service. It is still early but I am not sure at this point that I'll be doing another Groupon deal again anytime soon. I offered a specific type of massage that is gaining popularity in the area I live in and lots of people seem to be intrigued by it -- Bamboo Fusion Massage. I also did not get caught in a rush and was well prepared.  Prior to running the deal I readied my website with answers to potential questions on the deal. I enlisted the aid of my independent contractor MT.  I even added ability to my online booking system for clients to self-book their own groupon appointments, plus I hired a receptionist service to answer the initial flood of calls. I also created and printed out $15 off coupons to encourage client rebooking anytime within a month of their initial visit.

Aside from the so far 4 or 5 terrific new repeat clients I've added, most have been subpar from my regulars. My biggest issue is the low return on clients and the quality of the clients.  Many of my Groupon clients (thusfar) have come from further out than average just to get the deep discount. Regardless of how great the massage service is most of them have absolutely no intention of ever coming again. I had two ladies who came in together inform me as I was checking them out after their services that although they loved the massages they would never come back unless I was offering the same deep discount 'to make it worth the drive'! No thanks! I don't need clients like that. I wished them well and sent them on their way. A lot of the Groupon clients I get are pushy and do not feel they should have to book their own appointments online. I even had one person call me nine times with questions that were already answered on my website even though she claimed she had seen the page. I've had quite a few Groupon clients book appointments without providing their Groupon codes as required, then they cancel at the very last minute! Because I don't have the groupon code I can't redeem the coupon on Groupon's site...sometimes the name of the client is not the same as the person who purchased the Groupon so I can't even track the code manually. This leaves me with an unfilled slot that could have had a full-price paying customer in it plus I still have the outstanding Groupon that should have been redeemed for the missed appointment! Frequently Groupon clients call and ask for extras -- give me a break! They must be kidding -- I mean for the little bit of money I received on the deal I almost want to laugh into the phone. Many of them call up to ask if they can get massaged in the same room - even though it clearly states in the fine print that this is not possible. I had one Groupon client call and argue with me that he should be able to upgrade to a higher end service (Ashiatsu Oriental Bar Therapy) at no extra charge because he misread one of the FAQ answers on my site.

It has been quite frustrating thusfar. I hope I'm just getting all the bad apples out of the way first! 

I'm confused by this. So you do still sell the same amounts or are they things that have to be purchased and used the day of?
Oh so instead of mass numbers it just fills up your day? Nice! Thank you for this info. I will google it in a bit.

Read this great article about Groupon:

 

Why Groupon is poised to Collapse"

Hi Pual,

 

The information you have shared is great and inspirational to me.  I am a newbie to the field and want to generate business.  My stance is I'm an Outcall Mobile Spa seeking clients from 9am til 8pm Mon thru Friday and Saturdays 10am til 8pm and Sundays 3pm til 8pm.  What would you suggest for someone with this type of interest for 60 and 90 min massages?

Paul Brown said:

OK, here's how the process went:

In October, I was looking at ways of boosting my clients - last year was difficult, as I'm sure many of you can attest - and a hair-burner friend of mine suggested Groupon, as his salon had done one and had had good results with it. I contacted Groupon and gave them a proposal. The Groupon person assigned to San Francisco contacted me and we discussed what would be a good deal for me. I asked about conversion rates and no-show rates, and she didn't know, but did let me know that around 10 percent of a local gym's voucher clients had purchased memberships.

Groupon doesn't, or didn't, keep track of redemptions. They are building webpages that will let businesses report on redemptions, but that doesn't yet exist. So any data has to come from your own tracking.

Once we had an agreement in place, it was three weeks before my deal actually ran.

Once the deal was done being sold, I could go on the Groupon website and download a file that listed the names and groupon voucher numbers of the purchases - no contact information, though. This was a problem for me, because I would have liked to have been able to communicate with these potential clients about how to redeem in a way that would have made the vouchers redeemed in a more even and orderly fashion. But Groupon's stance is that the effectiveness of their communications would be diluted if the businesses could do so...

Once the redemptions started, though, my regular clients started complaining about not being able to book evening and weekend appointments, so I immediately changed my online scheduling so that Groupon vouchers would be only able to redeem during "business" hours - for me, that meant noon to 6pm Monday through Friday. This left my high-value time slots, evenings and Saturdays, open to my full retail-cost clients.

I had no problem with making groupon clients reschedule if I had too many bookings for a single day - I would either telephone them and reschedule with them that way, or would cancel the appointment online, explaining that I was unavailable at that time slot and they could either call me or just pick another time slot online. No one complained about this practice, and it seemed to work out well - I got to keep my normal practice of limiting the hours of bodywork I did, and I got to communicate with clients so they could get a feel for me and my practice and professionalism. I would always explain that I wanted to be able to provide them with the highest level of service and that by movig them to another timeslot, I would be able to. People appreciated this.

During the sessions, I would do my intake work, then explain their options to them - they could either get a session of overall relaxation work, or more focus (neck and shoulders, back, legs, hands and arms, etc). Most of these people took the session focus on neck and shoulders, so I got to really fine-tune my protocol for doing that detailed work. As my yelp reviews show, people really appreciated this.

At the end of the session, I'd dynamically offer them $10 off their next session if they booked right then. This discount would be dependent on whether they had already expressed a desire for regular bodywork or if they were a bargain hunter, or other factors. When I offered the discount, they were much more likely to jump at the re-book. If they were looking for a regular therapist and had used Groupon as a way of auditioning, they often re-booked, too.

Marketing my services is something that I feel very confident in doing - I can talk to anyone and anytime about what I do, what its benefits are for their specific situation, and then either book with them right then or get their contact info to contact them later about booking. All it takes is practice, practice, practice. Soon, it becomes second nature to do, and people often appreciate that you are taking time out to talk to them about their pains and stresses. This, is one of the keys to successful marketing - people want to be heard, to be appreciated. They also want to know what's in it for them, so being able to do both of these things is like owning a gold mine.

At the end of the voucher period, I put up a blog entry on my website http://paulbrown.net/ that explained that the voucher has expired and how they can still use the voucher as a $40 gift certificate to apply toward my services. The other thing I did, though, is I stopped offering a 30-minute massage session via my online scheduling system. I charge $40 for 30 minutes, and I want to maximize my profit. So, if they want to use their certificate, they have to pay the difference. I can still book 30 minute session on my scheduling system, but the public cannot, so I can limit who I allow to book these shorter sessions.

Norm Green said:
Thanks Paul. I was hoping you'd jump in.
In every post there are a few details emerging on what is involved when doing a Groupon. Can someone that has done one present the process from start to finish?
Details on things like: Once you decide to do a Groupon ... What happens next? Once someone buys your Groupon ... What do they 'get'? What do you as the entity offering one get when a Groupon is sold (are you notified of each sale or do you get a comprehensive report after the deal is done)?

The detail that Groupon sends out an e-mail to the vouchers purchasers one month before the expiration date, is important to know. When that e-mail goes out your call volume is going to spike.

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