Why you ought to think twice about that coupon site’s offer. ~ Angela Tomassetti

Via on Jan 24, 2012
Photo: dklimde, Flickr Creative Commons

Every week, inboxes around the country are flooded with offers from Groupon, Living Social, YouSwoop, etal, from yet another studio offering deeply discounted yoga class packages.

While I would have happily promoted a ‘deal’ to students and friends in the past, having worked in several studios that jumped on the coupon site bandwagon, I am less inclined. Frankly, I don’t like these sites. And I don’t think you should support them, either.

Now, I have done my time in sales and marketing. I understand business development is a very real expense for an organization. However, I don’t think these sites are being used appropriately by many small business owners. They aren’t treating these sites as such—(very costly) marketing expenses.

You see, as independent contractors, yoga teachers charge and studio owners agree to a set fee. As contractors, we have our own marketing expenses. We create and print business cards, promotional flyers, pay for web and email hosting, invest (in some instances a great deal of) time in blogging and self-promotion through various social networking channels. These are our expenses to bear, in my view. And often times, these efforts produce results not just for the teacher but for the businesses in which they are contracted to teach. The better I am at marketing myself, the more attractive I am to employ.

So if a studio owner would like to drum up new business, how is it that a burden should fall upon contractors?

Perhaps the general public does not realize many studios featured on these sites simply do not pay teachers for coupon-holding students. Or more insulting, studios may pay teachers $1 for a coupon-holding student. And do yoga teachers get a chance to negotiate this rate? Not likely. So why when teachers are hired at an agreed rate are they expected to go along with re-negotiated rates that, well, haven’t really been re-negotiated. They’ve signed no contract stating that fees could change at any time and without notice. What independent contractor in their right mind would?

I have worked for studios that offered a coupon or daily deal. While yes, initially, they provided a large influx of new students, the momentum never lasted. And, when the packages were so deeply discounted, I found a lot of students wasted remaining classes or the last two weeks of a monthly unlimited pass. You know why? They figured by the second or third class, the pass or package paid for itself. They’ve already gotten their deal.

Based on the psychology here, wouldn’t it make more sense for a business to offer its own coupon?

This isn’t to say all studio owners are placing the financial burden on their yoga teachers. While I taught at Bend Yoga & Movement Studio in Chicago, owner Marty Clemons paid a very fair $5 per head for each student that came bearing a coupon. This is a fairly standard rate. I wondered, at the time, how she could afford to pay $5 when any income from the coupon site was in no way covering the fee. It occurs to me, Clemons was using the site as a marketing tool. Reaching such a wide audience was an expense that was absorbed by her business. Was it successful? You’d have to ask her. But I think the fact she hasn’t done another since may answer that question.

This scenario plays out similarly for massage therapists, estheticians, or any other service provider that works in multiple outlets on a contract basis. When I realized my fellow 1099-ers in the spa industry were getting treated the same way, I stopped buying coupons for $10 facials and massages. I don’t believe in paying below market value for services requiring substantial investment for training, CEUs, liscensure, so on.

If you spot a good deal, I am not saying to turn a blind eye, but I do encourage you to be responsible. Ask management how contractors are compensated when you come bearing a coupon. If they won’t tell you, take a pass. I am sure you will find that whatever you saved isn’t worth the icky feeling that comes with knowing your quest for a bargain has exploited a neighbor and equally hard hit consumer.
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Angela Tomassetti is an Anusara-Inspired (TM) yoga teacher lives, learns, teaches and writes in Chicago. She, fiance and rescue dog share a home in the leafy Logan Square neighborhood. After 10 years working in sales and marketing for the investment management and professional services industries, Angela decided to trade her Jimmy Choos for a more grounded approach to life—in bare feet. She has been teaching yoga full-time since 2008 and can be found twisting and bending her way through various gyms and yoga studios in Chicago and its southwest suburbs. Angela spends her free time traveling, writing, swimming, cycling and seeking inspiration in all of nature’s splendors. You can follow her blog through www.blisswardbound.com or facebook.com/blisswardbound.

 

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9 Responses to “Why you ought to think twice about that coupon site’s offer. ~ Angela Tomassetti”

  1. Misty says:

    Amen! I do believe these promotional websites (groupon, etc.) are also starting to very aggressively sell this to business owners, and business owners do look at it as a modern day advertising which either they pay for or more likely their employees pay for….
    As a manger of a business that has employees who work on commission we have had to deal with the terrible ramifications of doing a group coupon two different times now (no choice, corporate made the deal) and it was an absolute nightmare. The average consumer has no idea how this hurts a business and many maybe do not care…but this little article is a wonderful piece that maybe will show a few the light…

  2. Laura says:

    Thank you Angela for this post, helping make people a little more aware! While these sites are good for promoting business short-term, it isn't fair for contract yoga instructors like us.

  3. Paula says:

    I'm all for a great deal – but not at the cost of the teachers I respect, love and appreciate! Thanks, Angela, for this post!

  4. Erin says:

    I agree, Paula. Discounting rates, especially for new students seems like a good way to introduce new people to the practice. However, tf a studio wants to offer such a deal, they should take the hit themselves – not force the instructors to.

  5. Julie says:

    Thank you for an insightful post and opening a great discussion on whether Groupon works. I totally agree with you that the expense should not be born by unsuspecting yoga teachers . I hope it inspires studios and teachers to start working successfully to expose more students to the benefits of yoga .

  6. Nicole says:

    Very good read! Appreciate and respect your opinion on this topic.

  7. Anonymous says:

    Lemme get another Amen! I am a massage therapist, and the place I worked for entered into a Groupon-like deal whereby we were expected to work for half our hourly rate. (In order to make it up to us, we received 125% of our hourly if the client returned up to 2 times.) The owner did it again, and having seniority I explicitly stated that I did not want any coupon clients. In its defense, I can say that my paychecks were larger with the influx of so-called “coupon riders” and the ensuing uptick in business. That all said, I view this as evidence of an alarming “race to the bottom” for massage therapists’ earnings, often at the hands of studio owners.

  8. Jim Newberry says:

    Forgot to mention: "Based on the psychology here, wouldn’t it make more sense for a business to offer its own coupon?"

    That's a good question, why bother with paying Groupon when businesses could directly offer coupons themselves? I think the answer is that Groupon has a much, much broader reach than most businesses. There are millions of people that get deals emailed every day. You get exposed to a much larger audience, and of course that comes with a price.

  9. natalia says:

    Great post . I totally agree with you.

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