Nordstrom Rack Groupon crashes coupon site


The Nordstrom Rack Groupon has almost crashed their site. Image: Wikimedia Commons

This morning, the national deal from social coupon site Groupon was half off a purchase at Nordstrom Rack. The Nordstrom Rack deal has caused the Groupon site to incorrectly function intermittently today. Groupon is becoming more popular, but that doesn’t always mean it’s good for business.

The Nordstrom Rack Groupon

The Groupon offered this morning was more than just 50 percent off at Nordstrom Rack. In addition to getting a $50 certificate for Nordstrom Rack for $25, the coupon site also offered a Kiva deal. First given out by Oprah, the Kiva deal that donates $25 in the user’s name on the microfinance site for $15 is proving very popular. These two popular deals are causing problems on the Groupon site. The Groupon Twitter this morning said “Hang in there, everyone: big things are afoot at today and we apologize for the site being so slow. We’re on it. Updates soon…”

Benefits to Nordstrom Rack

Nordstrom Rack, a discount retailer, could easily see several hundred thousand coupons sold through Groupon. A similar deal The Gap offered in August sold more than 440,000 vouchers. The Nordstrom Rack coupon will be offered through the weekend, so the usual daily time limit won’t exist for the Nordstrom Rack deal. Groupon takes about half of the cost of most of the deals on their website. This means Nordstrom Rack is getting about $12 on every $50 spent at their discount store with this Groupon — definitely less than they could get with a payday loan no faxing.

The effect of Groupon on small businesses

For big businesses like Nordstrom Rack, Groupon can be a great way to get customers into stores. Small businesses and local businesses, however, do not always have great experiences with Groupon. When Groupon deals are worth less than $7, Groupon keeps the whole amount customers pay for the Groupon. For small businesses, this means losing a significant amount of money on advertising that may or may not earn them a lot of money. There are options other than Groupon for businesses smaller than Nordstrom Rack, though. LivingSocial, Tippr, 8Coupons, and TheDealPlanet are all smaller, locally based group coupon options.