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Using Groupon for health and wellness businesses

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  • Lee, In

Abstract

Social merchants are small business owners and entrepreneurs who adopt social shopping as a new sales channel. They employ social shopping intermediaries, such as Groupon and LivingSocial, to promote their products or services to price-sensitive customers at large discounts. The success of social merchants depends in part on the reputation they gain at merchant review sites (e.g., Yelp, TripAdvisor, Angie's List), via which consumers post online product and merchant reviews. An analysis of social shopping provides insight regarding how social shopping works and what merchants must be aware of if they utilize social shopping intermediaries. This article shares these insights in the context of a set of health and wellness merchants that were studied for five years. Specifically, this article discusses how their Groupon daily deals affect merchant reviews, and how surviving vs. failed social merchants differ in terms of their review scores and number of reviews. Finally, this article provides recommendations about merchant review management to health and wellness merchants.

Suggested Citation

  • Lee, In, 2016. "Using Groupon for health and wellness businesses," Business Horizons, Elsevier, vol. 59(4), pages 369-377.
    • Handle: RePEc:eee:bushor:v:59:y:2016:i:4:p:369-377
    DOI: 10.1016/j.bushor.2016.02.001
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    References listed on IDEAS

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    1. Lee, In & Lee, Kyoochun, 2012. "Social shopping promotions from a social merchant's perspective," Business Horizons, Elsevier, vol. 55(5), pages 441-451.
    2. Chrysanthos Dellarocas, 2003. "The Digitization of Word of Mouth: Promise and Challenges of Online Feedback Mechanisms," Management Science, INFORMS, vol. 49(10), pages 1407-1424, October.
    3. Katz, Michael L & Shapiro, Carl, 1985. "Network Externalities, Competition, and Compatibility," American Economic Review, American Economic Association, vol. 75(3), pages 424-440, June.
    4. Dellarocas, Chrysanthos, 2003. "The Digitization of Word-of-mouth: Promise and Challenges of Online Feedback Mechanisms," Working papers 4296-03, Massachusetts Institute of Technology (MIT), Sloan School of Management.
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