Monday, February 18, 2013

When Groupon exploded to a billion-dollar valuation, it dragged all the bottom-feeders out. It's a new industry! It's a new world! Or, as with KGB Deals, it's a brand new scam.

KGB Deals started off strong but quickly slid into a clearinghouse for all the crap you haven't been able to find since Pic'N'Save closed. Throwing shit at a wall to see what sticks, they recently devised their "Dinner and the Movies" deal.



My advice? Stick with their miracle noodles.

The "Dinner and the Movies" deal clearly show us a business that's lost its tether to reality. Let's go to the math.


Two movie tickets + a $25 Red Lobster gift certificate + $100 Restaurant.com gift card = $156 value

The movie tickets have a stated maximum value of $26. The Red Lobster gift certificate is obviously worth $25. Given the package's estimated total value of $156, this means the $100 Restaurant.com gift card is worth ... drum roll ...

$105.

Now, we didn't just fall off the carrot truck. We started looking for fraud when we saw the words "Restaurant.com." Google turns up a lot of hits for them that also feature words like "ripoff" and "scam." In terms of online reviews, they're right up there with Battlefield Earth.

Ignoring the complaints from restaurant owners who say they never signed up or who want out of their contracts, we note the big problem in a typical restaurant's small print:



See, you're not getting a $100 "gift card." You're getting a coupon for $100 off a $200 purchase. If you think that's worth $105, I have a coupon for a buck off Gatorade that I'll let you have for $19.99. In the "Slightly Damning" department, Restaurant.com sells that $100 gift card for $40:



Forget KGB Deals' $105 valuation: is a coupon for $100 off $200 even worth $40? There are very few restaurants to choose from. When you pull it out at your table, your date will think you're a cheapskate. The restaurant owner will think you're a jerk. Your waitress will assume you're going to short her on the tip. There's a reason eBay has them in the $4 neighborhood.

In the face of reality, KGB's package value plummets. Using the Restaurant.com price, it's worth $91. Using eBay this amazing $55 bargain drops to, er, $55.

"Deals"? If I were the Russian secret police, I'd think about hiring a libel lawyer.

2 comments:

Yet Another Steve said...

Eew, the Blogspot assholes are putting ADS just willy-nilly here and there in your blog! I object!

RomanHans said...

It's my fault. I was suckered in by Google's promise that I'd get a check for $8 shortly before I retire. The saddest part is, even I can't tell what's an ad and what's a blog post.

StatCounter