From the Laptop of Jeremy Irish

Over the past year I have taken advantage of local deals through several different Groupon sites (Groupon, Tipper, Living Social). You can't resist, especially when they are for locations you already frequent. It feels like the deals are too good to be true so you have to buy into them.

Well, they are too good to be true.

There are already many articles about this, but most merchants don't do the math and realize how much they are really losing on these deals. The coupon customers are also unlikely to offer you repeat business. But as a merchant you become popular. More people walk through your door. It feels successful. You feel successful.

This was exactly how the dot com bubble went. Deals were everywhere, everything was free and there was no business model (except to be snapped up by a larger company, or go public). Your web site received a lot of traffic so it felt successful. And by this measurement you were successful. So money flowed and companies blossomed. Until they didn't.

There's a point where this bubble will burst, so get your coupon purchases in now. I am.