Daily-deal websites: are they as cheap as they seem?
7:12AM GMT 07 Feb 2014
When I open my email inbox each morning I am met with half a dozen emails from deal-of-the-day website Groupon.co.uk, having signed up to the site a few months ago to see what it had to offer. I am one of more than 200 million worldwide subscribers to receive emails from them.
The American company, which started up in 2008, now has more competition in the daily deals sector, with the launch of Wowcher.co.uk three years ago, and Barclaycard s Bespoke Offers (bespokeoffers.co.uk) launching in May last year.
These websites work by offering daily deals to their users at a discount. The businesses benefit because they get advertised to a new, wider range of potential customers, while the customers benefit because of the discounts.
This model is different from the popular cashback sites, such as Topcashback and Quidco. These sites also offer streams of special offers to their subscribers, but here shoppers collect cashback payments effectively commission paid by the retailer to the website then passed back to the consumer.
Wowcher and Groupon, by comparison, tend to offer a more random selection of eye-catching deals, with an enticing lucky-dip element of stumbling upon a one-off bargain you actually want.
Both Wowcher and Groupon, however, have faced frequent criticism from users regarding customer service, quality of goods and the reportedly exaggerated original price of the items, which are alleged to make it seem as though customers are getting a bigger discount than they really are.
Get up to 80pc off restaurants, attractions, hotels and more, Wowcher s website claims, yet users of the site have taken to internet forums like trustpilot.co.uk to complain about their negative experiences. One user questioned the real original prices quoted, while another said they are misleading with hidden costs .
Groupon attracts similar complaints on online forums, with one disgruntled user saying: Each item I have bought through this site has broken within the first week of using. Obviously the companies can t sell these goods without massive discounts. Another said: The deals seem good but Groupon doesn t live up to what it claims.
In 2012, the consumer watchdog cracked down on Groupon after the Advertising Standards Authority (ASA) received complaints over its misleading promotional deals. The Office of Fair Trading found that Groupon had breached consumer protection regulations and insisted the company implement changes. It was told to ensure that reference prices (adverts that compare an original reference price against a sale price), including savings, are accurate, honest and transparent .
In 2013 the ASA was still receiving complaints about both Groupon and Wowcher, with 87 complaints about adverts by Groupon, two of which were formally investigated and upheld, and 57 complaints in connection with Wowcher.
A spokesperson for Groupon said: We are committed to the honest and accurate, fair and transparent communication of our prices to our customers, and we strive to ensure that such communications accurately and clearly represent if, what and how customers will save by purchasing a Groupon voucher.
While Wowcher said: We take the verification of original prices very seriously. Prior to any product or service going live on the site, Wowcher will undertake a combination of checks, including obtaining invoices from the merchant verifying original price, obtaining current price lists from merchants and performing mystery calls to the merchant to check pricing.
The offers I receive in my mailbox are often bizarre and entirely female focused. Although the sites would not admit the male-to-female ratio of the subscribers, it appears an overwhelming majority of deals are aimed at women.
One offer sent to my mailbox was Gastric Band hypnosis , at £25 instead of the usual £599.98 I could be hypnotised into eating less. For another £24.99 down from £49.99 I could buy an Ab Toning Belt to firm up my stomach.
Martin Lewis, founder of MoneySavingExpert.com, said: These deal-of-the-day websites often pump out a constant stream of daily offers, and a lot of them aren t very good. I m not saying people shouldn t use them, but be prepared to rifle through all your emails to find the odd gem in there.
Barclaycard Bespoke is a relatively new player in the daily deals market, but Mr Lewis said this does not mean the deals are any better. Barclaycard Bespoke Offers is still trying to build its marketing share, so some of the deals can be quite good. However, it is not very different to the other deal-of-the-day sites, and most of what they offer is fairly poor.
If you don t mind browsing through the many emails from deal-of-the-day websites, there are some deals that offer attractive discounts. Barclaycard Bespoke customers can get 20pc off Valentines flowers from Flowers Direct, available until February 13, while Groupon customers can buy tickets to the Bike and Triathlon Show in Manchester on March 8/9 for £6, rather than £12, available to buy until March 5. See below for more of the best deals.
Morphy Richards 8-piece pan set with free delivery: £59 (originally £199.99) Available to buy until Sunday
iPhone 4/5 charging case from Chimp Electronics: £10/14 (originally £20). Available to buy until February 25
Luxury Spa Package at Chester Grosvenor Hotel: £49 (53pc off). Available to buy until February 27
12GB PS3 console from Jak: £134.99 (originally £189.95). Available to buy until February 10