Groupon... any success or horror stories?

[The Chairman]

Groupon is a result of Social Media needs to actively promote (advertise). Many who are over using Facebook and twitter should really consider this as a better alternative for broadcasting to the masses.

There is a current discussion where one member is vilifying Groupon for the state of instruction at a local dive spot. What are your thoughts about this?

http://www.scubaboard.com/forums/ne...ion-many-us-have-ever-seen-avoid-groupon.html

 

[divezonescuba]

We did the Discover Scuba Groupon, Buy with Me, Urban Delight, etc. Most of the people who buy these types of coupons would not ordinarily have interest in diving. Many cannot swim, others have never been in a pool. The questions are unbelievable:

"Are we going to do the class in the ocean?"
"This a full certification for $15?"
"Are there fish in the pool?, I don't want to swim with any fish"

It is also difficult to schedule these people as well. Many of them want to do it in groups and cannot coordinate a common time. When you receive less than half of the coupon price, you are mostly losing money.

Because the cost is small, there is little consideration for reservations. We have had people that show up when they are not scheduled, not show up when they are, and come almost an hour after the three hour session is scheduled to start.

The conversion rate also seems to be extremely small as these people as a whole cannot afford a complete certification.

 

[rob@diveinutila.com]

From the Groupon thread

All of this is a result of being able to get my OWC for 150 instead of 400.

I don't know how people can do an OWC for $150. We would loose money on that - the more people that responded the more money we'd loose. Are there really dive centers out there who can make money on a $150 OWC?

I am kinda interested in this but I can't see how I can make money on it. Our profit margin is already so low that cutting it in exchange for more customers barely makes sense. And for sure I can't get the offer low enough to look attractive on Groupon. If anyone else knows how to please let me know!

 

[mselenaous]

+1 Rob. Themons, thanks for confirming your experience. I have heard similar comments on the issue.

Once you get the price down enough to be attractive to Groupon (such as half price), Groupon gets half that $, so you could get 25%. I don't know any shop that can afford to run a class for that low, and if they could, then they probably aren't competitive in the local market to begin with. Certainly a class would have to be "ala carte" charging separately for books, rentals, check out dives, just to be able to pay a modest amount to the instructor. Most shops are already at or below cost as a loss leader to gear sales, boat charters, etal.

 

[cerich]

I understand they also hold 50% of the money for 6 months, so you actually only get up front half of the money, so you are working from a terrible deficit.

I note that Groupon seems to be working hard to offer "Bucket List" activities at cut rate prices. This is a easy sell for Groupon, it is not however a good idea for the LDS. People buying a cut rate scuba course while checking off a box on their bucket list are very unlikely to become "divers" as a lifestyle, nor are they even likely to invest in mask,fin, snorkel for the course/one time activity, instead you see borrowed gear or cheap Wal Mart gear frequently.

Participating in Groupon on a cut rate discount course is simply a desperation move leading to "death by a thousand cuts".

That is not to say there aren't opportunities there. How about a deal with the local aquarium where you offer a combo admission/discover dive for a set price? Tehn it become targeted marketing instead of a shotgun approach.

 

[danvolker]

I'd also add that at the BHB where this Groupon has had the abusive effect, I think one of the dive shops involved is actually one of the shops known for very good instruction....And so you have this shop that you'd expect so much from, running a frighteningly scary class --from the perspective of turning out divers who are not really going to be divers...Whatever expectations they may have had, are unlikely to be attained.....and then there is the future issue...will future prospective students check around and hear how badly this shop or that shop has done with some of its low priced classes?

I was at the BHB yesterday around 5pm....there was a class of I think 8 students, with an instructor and what was likely either a DM or assistant instructor following---he was there to look for students in trouble I think....He appeared to be watching carefully, so this much of the planning was well done....what was horrendous, was the majority of the class "following" the instructor, who did not appear to care that they were all very overweighted, and were continually kicking their fins into the bottom. There was no teaching of bouyancy control, prior to their heading off over some of the nudiranch. frogfish and octopus areas. A huge cloud of silt soon covered the entire area. They did a tour of most of the BHB hot spots, and bottom kicked it the entire way!!!

The biggest tragedy may infact be the economic impetus to turn this form of instruction into acceptable skills development--and there reallt were no boyancy and trim skills being acceptably performed. You might say that the bouyancy and trim skills are the hardest to teach, and in many new open water divers, it may be many dozen dives before they get these--if they ever do.
But these are skills that will have a huge impact on each student's future path as a diver, and I believe this "Groupon Effect" could be very bad for most dive shops.

If anything, dive shops need to find better targeting of who should want to become divers--this needs to be very different than just offering classes for HALF PRICE .. OR MORE!!!