State attorney general grills deal site.
If "Groupons" are gift certificates, there's a daily deals site in Chicago that may run into some trouble in Connecticut, where it's unlawful for gift certificates to have expiration dates. When consumers buy Groupon's deals, there's typically a months-long timeframe in which they have to use the offer - otherwise it's an empty purchase.
"It appears that what Groupon, Inc. sells or offers may fall within the definition of a gift certificate under Connecticut law," Connecticut Attorney General George Jepsen said in a written statement yesterday. "I have not prejudged Groupon or reached any conclusions. I am hopeful that any issues can be resolved through discussion and cooperation."
Groupon put out a response, saying the company would help "him and his team understand our business model as it relates to the many Connecticut merchants and consumers who use our service."
The development underscores a couple of items.
First, it's a little unclear to most people what exactly a "Groupon" is. Is it a for-me gift certificate, a coupon, or the term Groupon, LivingSocial and other daily deals players prefer, a "voucher"?
Second, the Connecticut Attorney General's office isn't afraid to challenge business practices of web-based companies.
Last month, Jepsen and his team sought explanations related to consumer privacy in concerns to Facebook's "Tag Suggestions" feature. It involves facial recognition software that identifies Facebook users in photographs and stores the information in the Palo Alto, CA-based firm's database.
In May 2010, Richard Blumenthal, the state's attorney general at the time, demanded evidence from popular classifieds site Craiglist.org that it was combating the posting of advertisements for prostitution and other illegal activities. San Francisco-based Craigslist shuttered its "adult services" section three months later.
Join the Industry's Leading eCommerce & Direct Marketing Experts in Chicago
ClickZ Live Chicago (Nov 3-6) will deliver over 50 sessions across 4 days and 10 individual tracks, including Data-Driven Marketing, Social, Mobile, Display, Search and Email. Check out the full agenda and register by Friday, August 29 to take advantage of Super Saver Rates!
Christopher Heine was a senior writer for ClickZ through June 2012. He covered social media, sports/entertainment marketing, retail, and more. Heine's work has also appeared via Mashable, Brandweek, DM News, MarketingSherpa, and other tech- and ad-centric publications. USA Today, Bloomberg Radio, and The Los Angeles Times have cited him as an expert journalist.
The Marketer's Guide to Customer Loyalty
Customer loyalty is imperative to success, but fostering and maintaining loyalty takes a lot of work. This guide is here to help marketers build, execute, and maintain a successful loyalty initiative.
The Multiplier Effect of Integrating Search & Social Advertising
Latest research reveals 68% higher revenue per conversion for marketers who integrate their search & social advertising. In addition to the research results, this whitepaper also outlines 5 strategies and 15 tactics you can use to better integrate your search and social campaigns.
August 21, 2014
September 23, 2014