Picture it – November, 2010. Toronto.

As I looked for holiday gifts, TeamSave (a group discount site) offered the Blossom Package at Chakra Spa – A thorough spa experience, where the lucky patron is gently attacked with all manner of fruit. This results in relaxation. Simple enough.

I purchased the package, believing my girlfriend would love it. She certainly loved the notion of it, but that’s about as far as it got.

Two weeks after receiving the gift, she called Chakra and was informed that they were undergoing renovations. They insisted they’d be back ASAP, at which point they’d honour any coupons or packages. A month passed. Same message. After three months, their sign no longer appeared above their door, and their answering machine was too overloaded to accept any new messages. We’d been duped.

My anger at the situation was reflected in two emails I sent to both TeamSave and Chakra. The latter has yet to be answered, while the former was addressed, refunded and apology issued within 48 hours.

From this experience, I can say that I have no beef with group discount sites. They’re far more accountable than some of the businesses they represent.

From an advertising standpoint, sites like Groupon, WagJag et al offer a great opportunity to local businesses. The model works on the notion that the loss in immediate revenue is small compared to the wide-reaching promotion they receive. Therefore, a restaurant offering $60 of food for $20 gets a sudden surge of business from people who a) want to try new dining experiences and b) are taking advantage of a deal.

At that point, the ability to turn that promotion into recurring business is in their hands. Take note, local businesses owners. Here comes the market research.

As a purchaser of a group discount, I expect the following:

• That my purchased product/service will be rendered within a reasonable time of my redeeming it.

• That said product/service will be honoured without the stipend of buying more at the “regular rate.”

• That the business allows me to enjoy their product/service without being immediately up-sold.

• That the business actually exists.

It’s not rocket surgery. My positive experience in your establishment will quite likely make for a repeat visit in the future. Being treated like a nuisance reminds me of why I was never a customer to begin with.

The trouble is, when redemption goes bad, it really goes bad. Those who may have seen the $99 for $400 worth of organic meat deal from The Butchers in Toronto has likely also heard the uproar around their previous deals. This particular establishment has developed an unfortunate reputation for running afowl of the quality of their offering and the hurdles coupon holders have had to jump through to claim their product. At last check, The Butchers has heavily regulated the hours in which they will honour coupons, and has even gone so far as to enlist police officers to ensure their staff are not “verbally or physically assaulted.”

Upon reaching out to my contemporaries, I was provided a wealth of unique (but similar) stories. These are the words of real people who may or may not be in the witness relocation program.

AS writes:

“I bought a Groupon for VIKASPA in Yorkville. When I called to redeem two weeks later, they had no available appointments…for three months. Five months later still not able to redeem. Oh, and they’ve had three offers since I’ve purchased. My feeling as a consumer? No one is regulating these companies, so really, the company is just receiving money from me, not providing the service and soliciting more offers to keep the scam going. Not sure it’s truly the case, but it’s messed. I’ll never buy a Groupon again.”

LA recalls:

“My friend and I bought WagJags for a “no strings attached” trial run at Extreme Fitness that “included” personal consultation and training sessions. After a preemptive tour of the facilities, we were lead back into the membership room, whereupon the hard sell began.

I told them that we were in advertising, knew that the assessment was a trainer upsell, and that we were only interested in taking advantage of the equipment. Their response? That “an assessment and training was mandatory within 10 days of redeeming our WagJags, but could be waived if we signed up for the year long membership  – which was only available if we signed up, more or less, on the spot.”

We left and were determined to call our $24 a loss. WagJag was incredibly responsive, but I’ve been actively denigrating Extreme Fitness every since.”

LA2 notes:

“I purchased a spa gift certificate only to show up to a deserted parking lot. The woman at the office next door said that in fact the address provided to me was a wood shop. After calling the ’spa owner’ repeatedly I was told that the spa had flooded and all appointments were cancelled. Needless to say, I got my money back. I’ve had some great experiences with Groupon, however, so I’m still a fan of the online discount trend.”

JD weeps:

“My friend purchased a Groupon for a meal pack from a local Panago. So, he went down to pick up his deal, however they charged him the HST. He didn’t have any cash/credit on him. The cashier was very impatient and got frustrated that my friend had a Groupon receipt. My friend mentioned that he’d paid the HST and it was included in the Groupon. The cashier argued with him, and when they weren’t able to come to a resolution the cashier threw my friend’s combo into the garbage in front of him.”

SV noms:

“I got a box of free Krispy Kreme donuts. True story.”

In most cases the discount sites are not to blame for the shady dealings of the companies they represent. Customers will get their money back from the discount site itself, forcing them to take a loss for behavior beyond their control. For many, the image of these sites is inextricably linked to being screwed by the deal. The end result could be that the opportunity to try new things on the cheap is sullied by greed, opportunism and bad business sense.

Google has recently launched a beta version of its own discount site in four cities. Will they allow local businesses to run roughshod over unsuspecting customers, at the cost of their own corporate image?

More importantly, will Chakra Spa return from its six month slumber? Inquiring minds want a mangosteen/passion fruit exfoliation.