It is with sad news that today I was notified by Discover that they have elected to drop their Shop Discover casback from partner Groupon down to 5% effective today. The cashback payout with Groupon when using the Shop Discover portal has always floated between 10-20%.

Back in June, Discover temporarily lowered the payout on Groupon to 10%, after apparent comments from their users that were confused by the terms, stating:

When Groupon was at 15% Cashback Bonus, the Terms and Conditions excluded purchases of Groupon Goods and Groupon Getaways, and we received calls from cardmembers who were confused by this. So, in order for us to better the customer experience with Groupon, we have lowered the overall Cashback Bonus to 10% but are now able to offer it on Groupon Getaways and Groupon Goods.

Then in September, Discover revised the payout back up to 15%, but with new exclusions:

Offer not valid on Getaways, Occasions, Live & Now, Epic Deals, Groupon Gift Cards, Groupon Reserve and Charity Promotions

Now, with Discover dropping the payout down to a record 5%, they have not completely opened up the exclusions:

Offer not valid on Getaways, Groupon Reserve and deals that redirect from Groupon site.

In Conclusion

Groupon lowers their Shop Discover cashback payout on Groupon to 5%. This is a BIG deal from a marketing perspective!

Over the course of a day, I peruse tons of forums and blogs that cover an assortment of topics from finance, travel, and deals in general. There is one universal theme that carries across all walks of dealdom, and that is Shop Discover is the leader in payouts to their customers.

We have compared countless times the Shop Discover retailers versus the other portals that payout part or all of their commission back to the consumer, and Discover is ALWAYS at the top of the chart.

So where does this put Groupon?

Sites like FatWallet, eBates, Mr. Rebates, and Big Crumbs all payout a measly 3%.

TopCashback, which supposedly pays out their entire commission and rather makes their money off advertising, pays anywhere from 1-5% cashback, reserving a 10-15% payout for only new customers in select categories.

The various frequent flyer miles & hotel rewards portals pay anywhere from 2-6 miles per dollar, but I would never recommend using them since they are run by evil companies such as Cartera that have been known for horrendous customer service and typically do not always paying out their customers.

Having exclusions for what qualifies for cashback is typical in the industry. I have a hard time believing people using the Shop Discover portal can be that confused over what does or does not qualify for cashback, when it clearly tells you upon clicking through to the merchant.

I find it very discouraging that the Shop Discover portal, at least for Groupon, now puts the program more in line with the other portals because some people cannot figure out how to read directions.

Anytime I see a deal posted on a forum or blog, it is synonymous to also mention using the Shop Discover portal to earn X% back because they simply were the leader in the industry. Sadly, the move to only pay customers only 5% no longer warrants the premium acknowledgement. Quite possibly, you will see others that routinely purchase their Groupon’s through Discover switch to other cards.

I have even read countless comments from people who have gotten their Discover cards simply for the great payouts that come from the Shop Discover portal. This will be a big cashback blow to the loyal Groupon Shop Discover users, and I predict a major game-changer to how much Discover gets used in the future within its Shop Discover program. I foresee by the new year, Discover will reevaluate the payout with Groupon and possibly raise it back up to where it belongs, at the top of the pile to continue brand awareness of the Shop Discover brand.

Save Money, Travel More!

Source: Discover PR