Friday, July 1, 2011

Motorin' in Boston

Driving a Ferrari or Aston Martin through Boston for 45 minutes for $99 seemed like a good enough deal when The Motorsports Lab offered up the deal in April. However, the user posts are classic.

For starters, the deal was apparently offered last year, and some folks have yet to be able to book their rides given tight schedules and rain cancellations.

It gets worse. The suggested gratuity is nearly the price of the entire Groupon (based on $499 price) and the company's charging state sales tax based on the $499 suggested retail price instead of the $99 it is collecting.

You have to give the company the nod on the gratuity because it SHOULD be based on a deal's value. If you paid $25 for $50 worth of food through a Groupon, you should tip based on the $50. However, tipping nearly $100 for a 45-minute experience seems outrageous.

As for the sales tax, I saw an Orlando Groupon by a limo company that did the same thing. It's a legal gray area, and a Groupon rep condones the practice at one point in the Motorsports thread. I still find it hard to believe that a company can charge better than 30% in sales tax, or that it's reporting this revenue to the IRS at the full $499 price. The Motorsports Lab does seem to have a unique experience, but many Groupon buyers appear to be frustrated.

Sample Groupon Merchant Contract

The reDesign blog ran a critique of the standard Groupon merchant contract recently. It's worth a look.

Just because there are merchants that are dissatisfied with the Groupon experience doesn't mean that it's a bad deal. In fact, the longer you are on Groupon as a user the more you see the same offers come back for more. In other words, clearly it's a promotional gamble that some feel bears repeating. Still, just passing along the link to a critique.