The Daily Deal Phenomenon – How These Websites Can Work For You and Your Company

It’s happened. I have become a daily deal addict.
Groupon, Living Social and Wowcher tempt me to part with my money on a daily basis for things that I may not necessarily need but at such hugely discounted prices, who can say no?!
It’s only January and I’ve already purchased my Mother’s Day present as well as treating myself and one other lucky individual to a massage and facial deal with a price that was just too good to be true.
To be honest I am amazed that many companies make money from the daily deals they offer through promotion websites. A full Swedish massage, Indian head massage and facial for two cost me £38. A saving of 76% on the usual price though surprisingly companies really do benefit. Between 55% and 61% of businesses running daily deals do make money on their promotions despite the huge discount (Rice University study 25/06/2012).
At my time of purchase 98 other coupons had been purchased from Groupon for this particular deal which had only been online for 48 hours (you do the math). I also know that particularly with beauty parlors and hairdressers you are very likely to return or even become a regular client if you are happy with the service. Even if next time round you have to fork out the extra 76%.
This has also happened to me. A great daily deal appeared in my inbox for a cut and blow dry (which I was desperately in need of I told myself) and saving me 60%. After my visit to the hairdressers I was impressed and have since returned to pay the full price. Of course companies could not always offer such hugely discounted rates, they rely on good service and word of mouth the promote them after their daily deal has expired. So, if you are running a good, honest service then it’s win win.
It really is a great promotional tool particularly for smaller companies to get their name out there and to get people in the door.
One particular start up company I have spoken to and done promotion work for listed themselves on Groupon towards the end of last year. As a gift wrapping company it was a great way for them to pull in business when they were going through a quiet spell before Christmas. It allowed them to raise their profile as well as bring in some all important revenue.
23 million Groupon subscribers worldwide purchased at least one deal in 2011. A customer getting those daily emails and paying for those hugely discounted deals really turns into a once you start you just can’t stop. Everyone loves a bargain, particularly a very high quality one and I say this from first hand experience.
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