Trying to decide if you want to offer a Groupon or another type of online group coupon? If you ask Harvard MBA and founder of Advanced Competitive Strategies Mark Chussil, he would tell you, “It depends.”

Not exactly the helpful advice you were probably expecting to hear, but it turns out that the business impact of offering a Groupon is determined by a number of variables.

“There is a lot of discussion right now about whether Groupon is a good idea or bad idea for business. They’re adamant that it’s either one way or the other,” said Chussil. Intrigued by the opposite experiences that offers have had on businesses, Chussil decided to design a simulation model specifically for restaurants to help further investigate the best candidates for running an online group coupon offer. He experimented with all sorts of variables and found that while sometimes it makes sense and sometimes it doesn’t, all things are related to one another.

Often the decision should be based on several variables that are looked at together. According to Chussil, here are some of the variables to take into consideration if you’re a restaurateur interested in trying Groupon or another online group coupon service:

• What is the average tab at a table? What is the value of the coupon? If you sell a Groupon for $40, most people will come expecting to spend $40. If the average tab for a table in your restaurant is $70 then it may not be such a great idea. You could be taking a table away from someone who would spend $70 for someone who is trying to keep their bill much lower. While you may also get people who spend much more with the coupon, you can’t rely on that being the case.
• How full is the restaurant otherwise? If your restaurant usually experiences a good amount of traffic then offering a Groupon is normally not a wise business decision. You could be turning people away that would be willing to spend more in order to seat those who will be using a Groupon.
• Who is your audience – your typical customer? If the type of person that you attract is the loyal kind that continues to come back, then a Groupon may make sense. By having new people visit the restaurant, you may build an additional loyal customer base. However, if you tend to attract the clientele that dines with you only once or maybe only for special occasions, then it may not benefit you to offer a group coupon.
• What will a group offer do to your brand and people’s perception of your brand? Consider the car manufacturers Mercedes and Kia. If Kia were to offer a coupon it sort of makes sense. But if Mercedes made the same offer it may appear to cheapen the brand.

There are other things to consider when making your decision about coupons. There are a certain percentage of people that never redeem their offers for whatever reason. And a restaurant typically only receives 25% of the face value of the coupon.

“Ultimately you need to ask yourself, what is the problem that I’m trying to solve,” said Chussil. “Are my sales too low? Do I want to move merchandise? Do I have empty tables? Not enough customers? Is my restaurant losing its cache? When you’re clear on the problem that you’re trying to solve then you can think about the best solution.

“Coupon programs are hot right now, but it’s not the only way to get people into your store or restaurant. Think about whether you should advertise instead or offer your own coupon, loyalty program or partner with another business.”

Yes, there are bad experiences and disappointments when it comes to offers, but Groupons and other online group coupon offers can make wise business sense for many retailers, merchants and restaurateurs. You just have to know when it makes sense for you, because “it depends”.