The sites use the power of collective bargaining to forge discounted deals with a variety of local venues - spas, yoga studios, hotels, restaurants, etc. - and only after a minimum number of people purchase the deals do they "go live" and activate. It's supply and demand at its most basic; the more people who want to buy, the negotiable and lower the price. It's not an original idea since consumers have been clipping coupons and buying in bulk since forever (Costco, anyone?) but taking it online is well-timed and appropriate in our tech-driven world.
Both sites offer one deal a day, with a smaller side deal, so users are not inundated with too many options. You don't even need to check the websites; subscribing to their daily newsletter will have each day's discount land in your inbox first thing in the morning. Customers are then incentivized to share the deal of the day with friends so they can buy into the deal and make sure the minimum number of buyers is met. This viral form of marketing means that Groupon and Scoop St. only need to focus on negotiating great deals with interesting places and the customers will naturally follow!
Discounts range from 40%-90% off original prices, and is a great way to try a new local place that you wouldn't have otherwise. It's great for you since it's subsidized, great for the local companies to attract new faces and hope they become loyal customers afterward, and great for Groupon 'cause they collect the fees without having many other costs.
Recently, my roommates and I got a Group-on on a house-cleaning maid service. Originally $99, we got the deal for only $49. This beats our regular maid service which is more expensive and refuses to clean out the refrigerator. Sweet deal!
Currently, Scoop St. only services New York City, but Groupon offers deals on 52 cities (although I can't vouch for the depth and breadth of discounts). Check them out, I'm sure there's something for you!
