Most people here are IMer's. As such, Groupon can't be used.

Some things to note:
You must discount at least 50% of real value.
You get 50% of that.

So, for a $100 product. It gets sold for $50 on Groupon.
You get $25 and Groupon gets $25.
However, it's paid out over time. Not all at once.

It can be effective when used properly and devastating when nott.

http://articles.nydailynews.com/2011...-site-cupcakes

Might want to read this I watch a show about how business were losing their shirts because they were discounting so low making less then costs and so many orders money because extra staff wages also.

That's why I said used effectively.

Too many business owners jumped on the Groupon band wagon without being educated on it first.
They didn't have the proper structure in place.

I tried to run a groupon in the past using the budget small business website paradigm and they were hearing nothing of it. I contacted all the other clones too with similar results. Many said they were focused on lifestyle products. Some of the other sites had run deals on sites in the past, either these werent very profitable or they were done inhouse. I think it was the latter.

Groupon owns numerous international operations, all of which were originally deal-of-the-day services similar to it, but most of which were subsequently re-branded under the Groupon name after acquisition

Im not a fan of Groupon BUT
For the majority of small businesses it was the BEST chance they
had to get their name out at a small price.
It didnt work for many because they were not educated on how to set up a backend,
or they were greedy and didnt put limits or did not structure the offer for maximum returns.

Lots of good info, thanks everyone, this was what i was looking for.

Groupon can be pretty cool if you know exactly what you're doing and why you're doing it.

IMHO it doesn't work for all businesses.
It works if your goal is to get the word out and customers in the door...
and if you offer something that people will need/want in a regular manner...
and you have a good chance to convert them into regular customers.

It works if you consider/treat it as an investment (of time and/or money) into
marketing. Cause that is what it really is. Don't expect to make money
directly with the deal cause that will hardly ever happen.

It also works if you need to sell off products without losing money...for instance
to make room to store new products.

Certain businesses seem to serially get (or better: feel) burned with Groupon...
mostly because they can't/don't calculate properly. But there are more reasons.
Especially with restaurants it seems that there are hordes of people who serially
shoot cheap dinner deals without the least intention to ever go back to that
restaurant because it's just not their price class. So restaurant owners don't at all
get what they want... no returning customers ...and probably even guests that
don't really fit the place.
At least this is what I watched over here in Europe.

One more tip... the competition on the deal market is high. There are many platforms and the easy market of "first time customers" is getting pretty narrow. It's a good idea to talk to a manager in order to work out a better deal than the standard "50% off regular price and 50/50 with Groupon".