Around the Net
Are Daily Deals On Up-And-Up?
- Business Insider, Friday, October 14, 2011 12 AM
Thumbtack.com, an online marketplace for local services, purportedly called 10 vendors offering daily deals -- five from Groupon and five from LivingSocial -- and found eight instances where they were quoted a price over the phone that was cheaper than the advertised regular price being offered. For Business Insider, that justified the headline: “BUSTED: Groupon And Living Social Caught Inflating Regular Prices To Make Deals Look Better.”
Sure, in the body of its story, BI admits: “This is an extremely small sample size, but it is worth noting.” So, is there a story here? Scrape the sensationalistic headline, and the answer is a definitive maybe. “Part of the reason people like buying Groupon and LivingSocial so much is the fact that they are saving a huge percentage,” BI notes. “By inflating the regular advertised price, the companies can increase the percentage saved.”
That is, of course, if inflating “regular” prices -- as apposed to deal prices -- is actually a systemic problem for either Groupon or LivingSocial. Clearly, however, ten informal phone calls by a non-authority like Thumbtack does not a solid case make.
