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The trouble with those voucher deals around Canberra.

By ellabella - 10 August 2011 24

Be warned – Daily deal voucher redemption is not as straightforward as you might assume.

Recently, a problem has been revealed that involved a reputable voucher website offering a deal on behalf of a regional mobile mechanic. Almost two months ago around 3000 vouchers were sold nationwide for a Major Car Service plus cleaning through LivingSocial.com, but most buyers have not been able to redeem these vouchers.

The merchant responsible was The Go To Guys, and they advertised that the buyer would receive $405 worth of car servicing for $89- a bargain! However, buyers have not been able to contact the company to book their pre-purchased car services through phone or email. The phone is continuously engaged, and emails have not been responded to. Bookings made on the company’s website have resulted in no-shows.

According to staff at LivingSocial.com, an email was sent out to most of those who purchased the deal offering a full refund or credit for future purchases.

Clearly the merchant was overwhelmed by the sheer number of vouchers sold, and did not have the staff or franchises to cope with the deal they had advertised.

So what had happened to The Go To Guys? Well no-one knows, not even the voucher company, and that is one of the inherent issues with heavily discounted deals being offered by one larger company on behalf of local merchants.

Companies are looking for ways to survive the global financial crisis, and will clearly do anything to gain business, and may ultimately lose money in the long-run. The message here… support local merchants and just pay the full price!

What’s Your opinion?


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24 Responses to
The trouble with those voucher deals around Canberra.
Howaboutthat 9:49 am 21 Feb 13

We’ve also been enjoying a number of these L S vouchers. We’ve been to a number of great restaurants and overnight accommodation. I thought I’d try something different – I paid $50 for a recent offer ‘One-on-one personal and professional development consultation’ offered by a guy called M. It was valued at $165. Oh geez! Did I regret taking this one up!

The guy didn’t smile, was distant and abrupt. There was no effort at building any rapport. He seemed to be in a bad mood which became most clearly evident when he noticed that I didn’t put my full date of birth down on my details sheet. He tersely asked for it and I said I keep my dob private on the whole but I was happy to give him the year. Nil response. He then asked rudely ‘ What’s a public servant? What does that mean??’. It was quickly developing into a Monty Python sketch! He then asked questions which I had already provided answers to on the sheet. I said I was interested in starting a business and wanted to talk that through, maybe online. He said he can’t help me with that. I needed a business development coach. And didn’t I check his website on what he offers??’. I said I hadn’t – he said he provided the link in the fine print on the voucher (I’m still looking for it – not there). This guy clearly did not want to help me in any way.

I said that’s ok – I’m sure there is something we could discuss in the time we had remaining such as the hesitations I had around setting up a business. He was so disinterested that I ended up sayinhg that I didn’t think this was going anywhere. He offered me a refund which I accepted and left. However I found out from Living Social that he was in no position to offer me that. It has been a convoluted process trying to get a refund. After numerous phone calls (including two with the lovely M), I’m still not sure what’s the outcome is there.

I don’t know how this guy got a degree in counselling (though it says a Degree in Science on his letterhead..). He was unprofessional and astoundingly rude. I guess he is struggling to get work (not surprising) and showed his frustration in my 15 minute session. M really needs some professional development himself. Ironic….

stonedwookie 12:07 pm 12 Aug 11

good oil costs 60 bucks alone without labor,filter or anything anyone offering these cheapo tune ups is dodgey.
try lube mobile they are the best!

krats 11:17 am 11 Aug 11

chewy14 said :

Never had a problem myself.
And I would suggest that the lesson from your story would be for businesses not to offer deals that they can’t fulfill.

Common Sense-Dah!

Madman 9:35 am 11 Aug 11

You have to also remember that even though the company only gets half of the $89 and having to fulfil the orders processed, they’ve affectively paid for marketing in which they have received and gauranteed business from that marketing. Though the business needs to strategically think about how much they want to spend on this marketing. You could do TV and Radio ads for a couple of weeks and expect to pay $100k.

Strategically the business then needs to think, well if I’m going to do a voucher deal site – how much am I willing to pay in loss of services for upfront return and business that may lead into further business at full rates.

In this example the service company would have received $44.50 each totaling $133,350.00 for the 3000 purchases. Going off the $405.00 normal price they would have made a loss of $1,081,500.00

Therefore they should have thought if we want to spend $100k, then we can only allow 277 vouchers….

qbngeek 9:19 am 11 Aug 11

I should also add, that with things like car servicing, I firmly believe that you get what you pay for. IF you only pay $89 for a full service, only expect it to be worth $89.

I personally would not gamble $60k worth of car on a $300 saving.

qbngeek 9:17 am 11 Aug 11

We have used the wine offers a few times. The ones I have got through voucher sites, the wine has from Allbids/The Glass at Fyshwick and are normally pretty good for cheap wine. Several of them have been better than stuff I have paid a lot more for.

gentoopenguin 10:23 pm 10 Aug 11

I usually buy restaurant vouchers and check the reviews online beforehand. A little homework saves a night of poor dining… I guess it’s similar with other offers.

chewy14 8:54 pm 10 Aug 11

Never had a problem myself.
And I would suggest that the lesson from your story would be for businesses not to offer deals that they can’t fulfill.

Henry82 8:42 pm 10 Aug 11

There are HEAPS of complaints on ozbargain about these voucher websites. A lot of the places use the deals as a last resort to pull their company out of financial trouble. Generally there are reasons why they’re going out of business, usually dodgy practices, poor customer service etc. I’d only buy vouchers from places you know are good (or have heard good things about). Also, if its too good to be true, it probably is. The voucher sites do take a % cut of the purchase price, so take that into account when working out what ‘value’ your getting.

beh1972 8:30 pm 10 Aug 11

We’ve bought a number of them now and used them. Overall have been pleased and been to places we wouldn’t have normally gone to.

Only real negative was an Indian resturant in Gungahlin (the one near Aldi). A three course meal for 2 with breads ‘worth $92’) for $39. The manager made it soon clear we were only getting the cheapest items off the menu, full stop – which would have added up to about $58 normally. She wasn’t letting us near $92 worth!

But been really happy with everyone else.

Padoof 8:23 pm 10 Aug 11

It seems what happened with you and ‘The Go to Guys’ is a relatively rare occurrence and LivingSocial have done the right thing by offering a refund. Whilst a bit disappointing, you have not lost any $$$$.

I have purchased 4 things now and redeemed 3 (one booked in for a few weeks’ time) without an issue at all.

I am tempted by offers almost daily, refrain myself from purchasing nearly all (best way to save money…don’t spend it!) and am absolutely stoked with the bargains I’ve snaffled up so far.

Your story has reassured me that LivingSocial is a legit company who is looking after their customers.

sweetlibby 8:01 pm 10 Aug 11

I only buy ‘doing’ things for this reason from places I know that will be ok, like cockington green or the bird watching place. These are places I wouldn’t go to otherwise, but has been good just to check them out.

kezzafezza 7:13 pm 10 Aug 11

kezzafezza said :

They could have limited the number of deals/vouchers avaliable, but they chose not to.

I have used Living Social a few times, only for restaurant meals though, and I haven’t had any issues. Two particular favourites were discounted meals at George Harcourt and Pelagic. Both places I only went to because of the deal, but the deal worked, as I plan to go back to both, they were both lovely.

On second thought, not all deals I have got were fantastic. I just remembered a deal from a butcher we purchased, and the meat we got was revolting. The ‘delicious gourmet sausages’ turned out to be plain old breakfast sausages, and the rump steak tasted wrong, and got thrown out.

kezzafezza 6:59 pm 10 Aug 11

They could have limited the number of deals/vouchers avaliable, but they chose not to.

I have used Living Social a few times, only for restaurant meals though, and I haven’t had any issues. Two particular favourites were discounted meals at George Harcourt and Pelagic. Both places I only went to because of the deal, but the deal worked, as I plan to go back to both, they were both lovely.

thatsnotme 6:47 pm 10 Aug 11

If it sounds too good to be true…

These ‘deal of the day’ voucher arrangements are fraught with risk – and the vast majority of that risk is assumed by the business offering the service, and the customer buying the voucher. Most of the stories I’ve heard about these sites are from the photographer community, in the USA where these type of deals first popped up. There have been plenty of stories similar to this – someone releases a great deal, sells a bucketload of vouchers, and is physically incapable of actually delivering those services in any type of reasonable time frame. Consider also, that of that $89 that you’re paying, up to half stays with the voucher selling company…so The Go To Guys would be lucky to get $50 out of the deal. Then they need to pay tax, GST, wages, and all the other expenses that come with operating a business. If they’re lucky, they would have ended up providing the service for free. If they weren’t lucky, they’d lose money on every voucher sold – and that’s without taking into consideration all of the full priced business they no longer have the capacity to take on, because they’re so busy trying to honour voucher sales.

The experience of people I’ve spoken to about these companies in the USA is one where the deals site puts a lot of pressure on the business to offer a super low price as well – making it even harder to price the deal at a sustainable level. The line is that the deal is just to get the customer in the door, with an opportunity to upsell, or gain repeat business. They don’t really care whether that actually happens or not – by that time, they’ve taken their cut. There’s also pressure to offer more vouchers than the business may be able to support. It’s not good for their business if a good deal sells out too quickly.

Selling these deals is often sold to businesses as a short cut to success, getting their name out there, and effectively discounting their way to a customer base. I’m not sure having a customer base purely made up of bargain hunters is a great start though… Business success comes from selling something that people want, figuring out exactly what it is costing you to give that to them, and making a bit of money as profit on top of that. That’s a gross over simplification…but the idea’s there. Everyone’s after a shortcut to success these days, or after the deal of the year. Pay a fair price for something, and if you feel like you got value for your money, go back next time. That way, that business may actually still be there.

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