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Daily Deals Pass or Flunk?

September 13, 2011

Daily Deals Pass or Flunk?

Just about everyone has an addiction towards online daily deals and these sites have won the popularity vote in digital marketing. People are always looking for the next discount to dine, travel and shop.  Internet sensation Groupon and Living Social has been one of the fastest growing companies according to Forbes magazine.

These companies have sales representatives, instead of geeky tech engineers to help small businesses with online advertising to increase revenue and saving both the stakeholder and environment money on print.

Groupon and Living Social emphasize in the 4 p’s in e-marketing strategy. Product (merchant coupon) using technology to enhance online offerings, Pricing (half off/savings), Place (direct sale is to any customer) distributing a voucher online to the publics(stakeholder) from anywhere, Promotion/communication these sites implement in using cell phone applications, blog promotions and word-of-mouth to fill empty seats, than no seats. This objective is smart for both parties.

The strategy of these sites is to get as many subscribers to sign-up, they will receive an e-mail with a voucher for the best deal of that day but to get their bang for their buck, more than one subscriber must buy the same coupon to get the deal. This is a win-win situation for merchants to connect with local customers.

As a fellow subscriber to both daily deal sites, the output of this internet craze has made and outtake on the way people live their lives according to these coupons. Seeing the savings and rewards that these sites have to offer is sensational for all of our pockets but it can be remorseful.

For example, people  have become impulse purchasers because of these sites. Once the viewers open up the web page and they are mystified by the deal of the day. Suddenly, in front of their eyes is a digital timer at the lower right hand corner of the screen, ticking down. The adrenaline kicks in, the patron feels pressure and then they must buy before time runs out. People are shopping because it’s on sale when they have no money, it’s not such a great deal of the day after all. Is it?

Let’s add more fuel to the fire. Some of these deals are bad. Today’s deal on Living Social was e-mailed to me for an escape to a 9-day Savanna Safari to Kenya, marked down to 40% savings, including hotel and airfare for only $2697. It sounds great and all but why are they targeting the wrong audience (myself) who cannot afford such a trip. Most of all watch out for the fine print on the ad, it says that it can only be redeemed on certain months. Travel deals are not an end all, so you will be able to find a getaway that is within your price range.

To close, what is best for the consumer is avoid buyer remorse when purchasing. Redeem local deals only, look for national vendors, since most of these businesses are in your community. Do a buddy system and get on the same deal with a bunch of friends, which increases the incentives for all. Groupon will give you Groupon bucks to use towards your spending on their site and Living Social will give you a free deal coupon, if 3 or more buy. The commitment is better for both the consumer and merchant.

Hope you will find this useful during your next purchase.

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