Group Buying, There’s Power in Numbers but Beware

Many consumers are finding that there’s power in numbers. Group buying sites, such as,, and, offer steep discounts on local services that are being promoted that day. Local merchants get a burst of new traffic that will hopefully lead to new customers and consumers get great deals. You might have seen recent stories highlighted on CNN, USA Today and other media outlets, heralding them as a the new buying revolution, the Web’s latest retail craze.

But it’s not as simple as you might think to cash in on these deals. Group buying sites vary in their business models. Some require a certain number of takers before validating the deal, while others let you click to buy immediately until all the vouchers are sold. Some sites offer an incentive to share the deal. Others use the threat of losing the deal if enough people don’t sign up. The more you share, the more likely the deal will go through.

Many of these deals come with some fine print. Here are some things to watch for when using group buying sites:

  • Check Out the Deal – Sometimes merchants run different deals on different sites. Don’t settle for the first deal you see. Check out other coupon and group buying sites before committing.
  • Know the Restrictions – Some deals are on valid certain days or for a limited time. Tax and tip may not be included. Most of these deals do not give money back if you change your mind.
  • Read Reviews – A deal is only as good as the product or service sold. Make sure this is something that you’ll want to use, and check out the place using review sites like Yelp, Google Maps, or
  • Make Sure that You Can Afford It – Sometimes you can buy deals, such as get $50 worth of food and drink for only $25, but after adding the entrée, dessert and drinks, you might find yourself above that $50 budget. Make sure you know what the typical dinner or service costs before signing up.

Most of these sites offer a “How It Works” section. Read the rules before you start using a group buying site. Because these are local offers, make sure that the site offers deals in your area. If they’re not, you can sign up for the waiting list and when they add your city, you’ll start receiving emails.

These deals change often so you’re encouraged to check back daily or sign up for alerts to see the new deal of the day. As you get more friends involved with your group buying, you start getting peer pressure to buy into their favorite deals. Remember, it’s only a deal if you save money, not spend it. If you weren’t planning to buy that product or service then you’re wasting money on services and products that you don’t need.

{ 1 comment }

1 Emily March 31, 2011 at 8:46 am

My main problem with these “deal” sites is that they actually entice people with debt to spend more money than necessary. For example, you always save more eating at home than eating out. And do you really need those season passes to the local science museum?

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