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Several people shared stories of postponing purchases after finding out that certain items regularly go on sale, with some reporting saving 20% to 30% by waiting for better prices.
Rebates are heavily used for advertising sales in retail stores, and can be especially appealing to price-sensitive consumers by increasing their willingness to pay. For example, an item might be advertised as "$39 after rebate" with the item costing $79 out-the-door with a $40 rebate that the customer would need to redeem.
The name for the e-commerce platform, Groupon is a portmanteau of "group" and "coupon". Groupon's first deal was a two-pizzas-for-the-price-of-one offer at Motel Bar, a restaurant on the first floor of its building in Chicago. [10] [18] [19] The decision to focus on group buying proved wise.
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The economist Alex Tabarrok has argued, that the success of this promotion lies in the fact that consumers value the first unit significantly more than the second one. So compared to a seemingly equivalent "Half price off" promotion, they may only buy one item at half price, because the value they attach to the second unit is lower than even the discounted price.
In January 2022, the company announced it would cut back on promotional offers as well as adjust specific menu items in response to inflationary pressures. [130] [131] [132] In September 2022, the company launched an "Inflation Relief Deal" that for a limited time offered a 20% discount on online ordering. [133] [134]