Groupon Rolls Out Loyalty Program to Try to Make Merchants Happier

A new rewards program introduced by Groupon today will help merchants identify their most loyal customers and offer them special discounts.

Customers who opt in to Groupon Rewards will earn rewards by paying with the credit or debit card they have on file at

Groupon Rewards falls into the hot area of card-linked offers, which track behavior based on charges to a credit card.

Instead of requiring shoppers to use loyalty cards or remember to check in on a mobile app, it will automatically record a customer’s behavior as long as he or she uses the registered credit card.

Groupon says the program will also seamlessly tie into a merchant’s point of sale system.

BuyWithMe, which is one of the smaller daily deal companies in the space, also announced a new technology platform this week that attempts to close the loop to see whether a customer ever returns after making an initial purchase.

Critics often charge that Groupon and other daily deals sites decrease loyalty since customers can hop from one deal to the next without ever having to return to a restaurant or spa to pay full price.

Groupon is not explicitly saying that this program will track the effectiveness of its daily offers, but presumably, merchants will be able to tell if a customer ever returns after buying a voucher. Of course, the information will be limited to customers who have agreed to participate in the program.

Groupon says it is currently signing up merchants in Chicago and Philadelphia and will officially launch later this month. More markets will come on board this fall.

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I think the NSA has a job to do and we need the NSA. But as (physicist) Robert Oppenheimer said, “When you see something that is technically sweet, you go ahead and do it and argue about what to do about it only after you’ve had your technical success. That is the way it was with the atomic bomb.”

— Phil Zimmerman, PGP inventor and Silent Circle co-founder, in an interview with Om Malik