That’s right, the CEO of Loopt will personally clean your house for $5.
But only if 1,000 people sign up.
Only, I haven’t told him about the deal yet. He may not agree, but I’m using his name anyway. Hell, he doesn’t know I’ve put this offer out there.
Sound ridiculous? It is.
But that’s what Loopt is doing to popular San Francisco businesses. This “offer” came to me in a Loopt deal email.
In its bizarre reverse-Groupon model, they are trying to collect demand for businesses.
It would be sketchy but sort of acceptable if this were done behind the scenes. But they’re doing it out in the open using the businesses’ brand names with discounts the businesses didn’t agree to.
I wrote about the Loopt model the other day. One of the many challenges with Loopt’s u-Deals is that people would want discounts at popular places. Every time I’ve been to Bi-Rite Creamery, there’s been a long line out the door. They don’t need to discount like this.
Loopt is using the Bi-Rite name to build its mailing list. They are collecting people’s credit card numbers in conjunction with this purported deal. That is bordering on fraud. I would also consider it trademark infringement.
This has a lot of negative effects on unsuspecting businesses:
- Having to deal with consumers who view it as a real offer. I called Bi-Rite and they said “We have nothing to do with that.” While the fine print implies that it’s not a real deal, to the casual reader it’s very confusing. Bi-Rite reported having turned away other consumers who referenced the deal.
- Bi-Rite is a premium brand. Being associated with daily deals can dilute that.
- Long term SEO impact. If “deals” like this manage to rank in search results, it further affects the brand and their ability to charge full price.
This is so wrong on so many levels. As readers of this blog know, I think Groupon does a lot of things that are bad for businesses. But they do get the business’s consent beforehand. The Groupon merchant agreement specifically includes a license of the business’s brand. (Section 1.6)
Update: Loopt has since removed this “offer.”