Groupon is Doomed and A Few Good Links
Haha, Groupon. We already know that its business model has set itself up to fail, but I always enjoy a little anecdotal evidence. This weekend I finally gave in decided I needed a haircut and checked Groupon for any possible “Now!” deals, which are meant to be used the same day. A good haircut and color in my pretentious town runs at least $130, and I saw a deal for much less than that (I don’t want to give the actual price and get the merchant in trouble) a quick drive from me. Groupon puts the salon’s address, phone number and website in its deal detail page. So I call the number and ask if they have time for an appointment and they book me for an hour later. And then I casually ask (because this was definitely an experiment on my end), “Do you want me to buy the Groupon or just come in?” and they tell me to just come in. Three hours later, I walked out with a great haircut, perfect color and a blowout that’s good for a couple days. I got a great deal, and the salon, although it gave me a heavily discounted price, got to keep 100% of my payment and I tipped on the cost of the full-price service. The only loser here was Groupon, who knew nothing about the transaction, and won’t be collecting 50% of the deal as it normally would. Doomed, I tell you. Doomed!
Weekend Reading for General Enlightenment
Free Kindle eBook: The American Frugal Housewife sounds like it would have made a great blog 200 years ago. The feat of a book that was written as a practical guide on being economical in 1828 still being relevant and entertaining today is considerable. Child’s focus on self-discipline, being level-headed and putting children to work from a young age (none of this “useless play”) will resonate with anyone looking to bring restraint and practical wisdom into their lives. She has a dry tone that made me think she was from New Jersey, but it turns out that’s just how they all talked back in the day. You’ll learn about everything from what to season sausage with and the uses of herbs (and that blueberries used to be called the awful-sounding and possibly poisonous and/or acne-inducing whortleberry). It’s fun to learn about things that seem quaint and outdated until you realize it’s still perfectly applicable today. Consider the section entitled, “How to Endure Poverty”:
That a thorough, religious, useful education is the best security against misfortune, disgrace and poverty, is universally believed and acknowledged; and to this we add the firm conviction, that, when poverty comes (as it sometimes will) upon the prudent, the industrious, and the well-informed, a judicious education is all-powerful in enabling them to endure the evils it cannot always prevent. A mind full of piety and knowledge is always rich; it is a bank that never fails; it yields a perpetual dividend of happiness.
and a discussion of her modern society sounds an awful lot like our own (minus the terminology, I don’t know what a bottle imp is either):
Perhaps there never was a time when the depressing effects of stagnation in business were so universally felt, all the world over, as they are now.—The merchant sends out old dollars, and is lucky if he gets the same number of new ones in return; and he who has a share in manufactures, has bought a ‘bottle imp,’ which he will do well to hawk about the street for the lowest possible coin. The effects of this depression must of course be felt by all grades of society. Yet who that passes through Cornhill at one o’clock, and sees the bright array of wives and daughters, as various in their decorations as the insects, the birds and the shells, would believe that the community was staggering under a weight which almost paralyzes its movements? ‘Everything is so cheap,’ say the ladies, ‘that it is inexcusable not to dress well.’ But do they reflect why things are so cheap? Do they know how much wealth has been sacrificed, how many families ruined, to produce this boasted result? Do they not know enough of the machinery of society, to suppose that the stunning effect of crash after crash, may eventually be felt by those on whom they depend for support?
Luxuries are cheaper now than necessaries were a few years since; yet it is a lamentable fact, that it costs more to live now than it did formerly. When silk was nine shillings per yard, seven or eight yards sufficed for a dress; now it is four or five shillings, sixteen or twenty yards will hardly satisfy the mantuamaker.
If this extravagance were confined to the wealthiest classes, it would be productive of more good than evil. But if the rich have a new dress every fortnight, people of moderate fortune will have one every month. In this way, finery becomes the standard of respectability; and a man’s cloth is of more consequence than his character.
Offline Reading: I continued reading on money, debt and society in Harper’s magazine. The June 2012 issue isn’t online yet, but there were two excellent articles about money, “The Price of Admission” on the cost of college tuition and rising student loan debt and “In Recovery: Twelve Steps to Prosperity”. The first article was a brilliantly written dissection of college as a corporation and one with often bipolar views of itself. The second article introduced me to Underearners Anonymous, an anonymous organization similar to AA or NA. The founder had been attending Debtors Anonymous classes, when he decided that underearning was its own, separate disease/addiction. You may not be comfortable with the term disease or addiction describing something that is not a physical or physiological condition, but the organization addresses an important point: are we putting ourselves in a position to earn less than we are worth? I know that I’ve done this many, many times. Consider the “symptoms” of Underearners. Stability Boredom? I’ve been planning to write a post for some time called “How to be Consistent without Getting Bored to Death”. Giving Away Our Time? Happens all the time! In any case, I find the idea of underearning to be highly relevant. While no one operates independently of society and the economic realities of the markets, it certainly doesn’t mean you have to work for $10 an hour when you have taken the time to learn and develop skills that are worth more to an employer or business or when you have work experience that is relevant to a position in a different industry. If I am serious about earning more and paying off a ton of debt in just over a year, then heading to a meeting might be very worthwhile.
Bloggy Reading: There have been some excellent posts lately. It’s so hard to link to them all! My Twitter feed is always full of good reads on the net but here are just a few good ones:
ee musings hit a homerun with On authenticity in blogging. She is an adept writer and each post is always measured, thoughtful, sometimes funny and always realistic. Not realistic in a “life is shit and then you die” kind of way but realistic in that she sounds genuine and I have become a faithful reader. Plus I loved that she wrote her post on living in New Zealand for me and others curious about life there. Oh and I just realized she’s only 23. Seems like some of my favorite bloggers are the younguns!
Another favorite blogger friend, My Broken Coin wrote How to Make it in America. Good advice that’s not standard or recycled. But I don’t expect anything less from a regular Business Insider contributor!
Erin at Dog Ate My Wallet wrote about a friend from the other side of the tracks. Erin comes across as quiet and reserved (unlike bloggers like myself who fill their posts with exclamation marks!! And italics and bold statements!!) but her posts and her comments on my blog and others always blow me away. Her friend Russ lived a difficult life but that didn’t stop him from doing what he could do for his daughters. It reminded me not to judge other people and to live my life, which is always easier said than done.
Anyone who pays $50 for their car is awesome.
Modest Money wrote a great Mother’s Day tribute to his mom. Savvy, hard-working businesswomen always make me happy.
And lastly, it was a while back but Well Heeled Blog did a cool job putting her 5 financial stressors out there. Of course, I don’t wish her any stressors, but somehow, it seems like she got less stressed about it just putting it all out in written form and enumerating each stressor. She has a lot on her plate but darn if she isn’t staying practical and reasonable. I’m impressed.
I had more of you to add but it’s 2 am and I want to watch Mad Men. Next week: May Debt Update, a Triple Book Review and maybe an LA post. Stay posted!