Weekly Cinema Closes Doors; Groupon Coupon Deal Backfires

Group buying coupons are rooted in one and only one idea, and it’s not that the merchant will make a profit from the coupon. Group buying coupons count on converting coupon buyers to long term customer of the business after using the coupon. Unfortunately, Weekly Cinemas either forgot or never understood this concept, and signed deals with nearly every major and not-so-major group buying coupon company, including the biggest, Groupon. Now Weekly Cinema coupon buyers might be left with a worthless deal.

Weekly Cinema’s strategy massively backfired, announcing Friday that their future as a company is “under review.” Thousands of coupons purchased via Groupon, as well as almost every single other group coupon dealer (including Tippr, BuyWithMe, and DealOn), will no longer be honored.

How does this bode for the future of group buying? Merchants, for one, clearly have the wrong idea about what this type of marketing means. It’s not an instant return – it’s a long term investment. Consumers may also stop trusting the group buyers who can’t offer great customer service in these type of crises. Groupon has been awesome in this situation, and other dealers (luckily) were small enough to handle the situation (or otherwise had their financial ducks in a row.) But some, so I hear, did not. Their customs, and reputation, are in serious jeopardy.

This situation will not be the last time this happens, and will force some group coupon dealers to fizzle out. Will it cause the entire industry to eventually cease? Personally, I like the concept of group buying. Hopefully it will just add some clarity to what the real benefit – or not – will be for merchants (and consumers.)

Will you still keep using group buying coupons after the Weekly Cinemas incident? Or are coupons from dealers like Groupon just another marketing scheme that can’t be trusted?