The Better Business Bureau has issued an alert to the public about daily deals site SaveMore.com, which according to over 1,000 complaints “took money for daily deal coupons, never delivered.” This case illustrates one of the risks of dealing with daily deal sites whether as a consumer or as a business offering the deals. If the operator of the daily deal site does not follow through and honor the deal that it sold, it leaves a trail of spitting-mad consumers and legitimate businesses that may lose money and get their reputations sullied in the process when unhappy consumers complain.
According to the Better Business Bureau, customers in 45 out of the 50 U.S. states have filed complaints. SaveMore has a BBB rating of F, the lowest possible. Michelle Corey, BBB president and CEO, is quoted as saying the number of consumers affected is astonishing. “We may never know how many people were taken in by this company,” she said.
SaveMore shares close ownership ties with Douglas Van Arsdale, founder of debt settlement company, Credit Solutions of America. Credit Solutions was sued in 2009 by several state attorneys general. Daily Deals Media points out more about the people and network of companies surrounding SaveMore. The article also points out that a number of the “merchants” featured on the SaveMore website are actually affiliated with SaveMore in some way.
It also appears that legitimate small businesses have not been paid for deals that SaveMore issued in their name, and have filed complaints.
As of this writing the SaveMore.com website is still up and running. The site is still apparently accepting money from unsuspecting consumers, and possibly snaring more unaware small businesses to sign up to offer deals. The site claims to have saved over $9 million — the only question is for whom!
There’s a lot of press right now about Groupon and its IPO, but in my view the real story in the daily deal space is not about a legitimate company like Groupon. Rather, it’s always been about the potential for fraudsters playing in this space. Just look at the daily deals business model. It’s simply too easy to set up a website, collect email addresses, and purport to sell people something in the form of a voucher or coupon – and then pocket the money. Even a legitimate daily-deals company with the best of intentions can run into trouble and find the money all too tempting when the rent is due.
And then consumers and small business merchants get hurt.