LivingSocial From A Restaurant’s Perspective

Living Social, Daily Deals, Groupon and other deal-a-day sites are great for customers. The Keeper and I have bought deals on food, cleaning services and one for a day out at a firing range from Living Social. But what about the businesses that participate in these promotions? To be honest, I never really thought about what the businesses get out of these deals or what impact these deals have on them when they are redeemed. I was just happy to be paying half price. But last Friday I got to experience a Living Social deal from the perspective of someone working in a restaurant. Here’s what went down:

We started getting calls at about 9:30am (an hour and a half before we actually open) from people asking questions about the deal and wanting to make reservations. The deal in question was with Living Social’s brand new “Instant Deals” function and the deal itself was $20 worth of food/drink and you pay only $1. They’re calling it their $1 Lunch deal and it was supposed to be valid from 11am until 2pm.

So when the managers on duty realized what was about to happen when we opened (the manager that handles making promo deals like this was conveniently scheduled until later in the day), they began frantically calling employees who weren’t scheduled to try and bring more kitchen and serving staff in to handle the extra traffic. I work in the back office normally, but being a new employee and knowing that the restaurant was going to be slammed today I volunteered to help out. They stationed me up front with the hostesses to redeem all the deal codes.

We opened at 11am and were pretty much immediately slammed. There was a line of people going out the door waiting for seats and to place carry out orders. There were people who had made reservations who weren’t getting seated because we were so packed. The kitchen was so backed up that people were waiting up to an hour for their food, both dine-in and carry out. We had to cut off service before the time that had been designated on Living Social’s site because of how backed up everything was. It was a nightmare.

Now, to be fair, I doubt this sort of thing happens with the normal deals from Living Social and other such places. Usually it’s a deal for 50% or so and it doesn’t become usable until the day after you buy it. Then there’s an expiration date like any other coupon, so people have weeks, or sometimes months to use the deal. This $1 lunch thing had a window of 3 hours in which to use it before you were refunded your money and the voucher code was no longer valid, so it stands to reason that during that window the places participating would be packed. However, as best we could tell, no one had given Living Social a maximum number of deals we could handle. Their site sold out of our deal before we actually opened, but we have no idea how many deals were bought. This sort of thing is more likely to hurt business than help it, which for the businesses is the entire point of participating.

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