How Does Groupon Pay Merchants?

So you know how to redeem Groupon vouchers, which is a key step in ensuring you get paid for your services, but you may still be wondering: how does Groupon pay me?

Or if you’ve already received payment, you may be asking: what’s this Promotional Adjustment on my pay statement, and how does it factor into calculating my payments?

For a quick visual guide showing you how to check your payments history and status for each month in Merchant Center, check out this video tutorial:

Below, we’ll go into further detail about:

• Groupon’s Payment Schedules
• How Groupon Merchants Receive Payment
• How Promotional Adjustments Work

When Do Groupon Merchants Get Paid?

There are two payment schedules which merchants get sorted into based on your deal structure. The vast majority that redeem vouchers normally will fall under Payment on Redemption, while a smaller number that use custom codes for redemption may fall under Payment on View.

Under both schedules, payment is only received after the point of service, not at the point of purchase. Normally, if a non-Groupon customer picks up a coupon for your business but never ends up using it, they keep their money. Groupon works similarly: the customer’s payment is only released to the merchant when the promised service is actually provided. This way, Groupon can refund customers who never received the service they paid for, without having to recover those funds from the merchant. That’s why it’s so important that you redeem vouchers to ensure you get paid, and that you follow our best practices for increasing redemption rates and reducing refunds.

However, if you have a bookable deal where customers make a reservation upon purchase, you can set it up to automatically check in customers at their scheduled time, so you’ll still get paid for no-shows.

Payment on Redemption

Under this payment schedule, you’ll be paid by Groupon twice a month, and can check your payment schedule in the Payments tab of Merchant Center. You’ll be compensated for the Groupon vouchers that you’ve marked as used in the weeks leading up to each payment, minus any refunds that were issued to customers.

Payment on View

If you’re a merchant who uses custom pre-generated codes for voucher redemption, such as for event tickets, you’ll still be paid by Groupon twice a month. However, you’ll be compensated based on the customers who’ve accessed or viewed the redemption code on their voucher, rather than you marking them as redeemed.

How Does Groupon Pay Merchants?

Keep in mind that your Groupon contract will have more specifics about how and when you’ll receive payments from Groupon. Here’s an overview of how Groupon payments are generally processed:

1. Payments are made twice a month. In your Merchant Center account, the payment date listed is the date that Groupon processed the payment.
2. You can view an itemized breakdown of all your payments to date, as well as upcoming scheduled payments, in the Payments tab on the left side of Merchant Center. 
3. Once payments are processed, it takes about 3-5 business days for ACH payments to appear in your bank account, or 5-7 business days to receive a check. Here are some things you should keep in mind:
   • You’re only paid for vouchers that were redeemed prior to the date your payment was processed.
   • Payments aren’t processed on weekends, holidays, or the last five business days of the month.
   • If your processing date lands on one of the cases listed above, your payment will be processed the next available business day.

To easily reconcile payments, we recommend tracking the number of redemptions you make each week via the chart in your Merchant Center’s Home tab (when clicking on “redeemed vouchers”). You can also see how many vouchers were included in each payment by expanding the details on items listed in the Payments tab.

What Are Promotional Adjustments?

You may notice a Promotional Adjustment reflected in your statement, meaning your deal has been featured in one of Groupon’s Promotional Programs. Here’s how these Promotional Programs work to help your campaign get more incremental sales and revenue, and how they’ll appear in your payments.

How Do Groupon’s Promotional Programs Work?

If your deal is eligible, Groupon may feature it in our Promotional Programs. During these promotions, we market your campaign with an additional discount for a limited time to give you more exposure and sales. This discount can be up to 20% off the sale price, but your campaign will be more appealing to customers and have a better chance of purchases. In fact, deals with promotions tend to generate 60% to 70% of Groupon’s site traffic, and promotions can increase your sales by up to 30%, helping to cover the cost with the volume you receive in return.*

There are two types of Promotional Programs: Promotional Codes, and Targeted Discounts. To see if your deal qualifies for these, please check your Groupon contract.

*Groupon cannot guarantee any sales performance and results will vary.

Promotional Codes

A Promotional Code is a code distributed by Groupon for a specified period of time, which customers can apply at checkout to receive an additional discount on their purchase. A Promotional Code can be applied to an entire channel (e.g., Local Deals), category (e.g., Beauty), or subcategory (e.g., Massages).

Example: Customers can apply the code LOCAL20 at checkout to receive an additional 20% off on an eligible local deal.

Targeted Discounts

A Targeted Discount is a discount applied to a specific merchant offering, reflected on the deal page. Deals which receive Targeted Discounts are selected by Groupon’s Dynamic Pricing Tool. These promotions may adjust the price of an offering based on demand, seasonality, or related ongoing promotional campaigns.

Example: A merchant lists a massage at £22. During Groupon’s £20 Massage Days, our Dynamic Pricing Tool may pick up this deal, put a slash through the sale price, and promote it at £20 for a limited time so it can be featured in the campaign.

How Are Promotional Adjustments Applied to Payments?

If Groupon temporarily adjusts the sale price of your deal as part of a Promotional Program, then the Net Remittance Amount (your payout from Groupon) may be proportionally adjusted as well for each voucher sold as part of that program. If Groupon reduced the price, then the accompanying decrease to the Net Remittance Amount will not exceed 20%.

Typically, participating merchants who’ve been featured will see a Promotional Adjustment on their next statement, reflecting any adjustments made in that payment period.

Because your payments are based on the vouchers redeemed in that period, whereas Promotional Adjustments are applied to vouchers sold in that period which might not have been redeemed yet, it’s possible you may get a statement where your payout is less than your Promotional Adjustment deductions. This means the Promotional Program worked to generate a surge of sales, which will help cover the cost in later payments as those vouchers are redeemed.

Example: In the period January 1-15, you only redeemed a few vouchers, resulting in a £150 payment. At the same time, Groupon temporarily lowered your deal’s sale price so it could feature in a sitewide promotion. It generated a lot of purchases, resulting in a Promotional Adjustment of £175, but those customers haven’t come in to redeem their vouchers yet. Because your adjustment amount is greater than your payment amount, you will not receive a payout for this period. But since the Promotional Adjustment is never above 20% of the Net Remittance Amount for each voucher, this means you might expect to receive £700 or more across future payments as all those vouchers are redeemed.

If you’re a Groupon Merchant with more questions, check out our Support page in Merchant Center for more information on payments and managing live campaigns.