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  • What’s the (Daily) Deal?

    Posted Sep 26th, 2011 By in Media, YPM Blog With | No Comments

    58% Off Theurepuetic Massage, $6 for $10 at I Dream of Falafel, 88% off Faux-Mink Eyelash Extensions, and the deals just keep coming. Part social, part mobile, part local and all direct response, the rise of daily deals continues to take shape among the digital media landscape.

    For deal subscribers, an in-box may be flooded from the likes of Groupon, Living Social, Daily Deals, Woot, EverSave, BuyWithMe, etc.… For the “not yet” subscribers, listening to Pandora internet radio (sans ad free) or a search on internet yellow pages platform YP.com may likely be disrupted by daily deal solicitations.

    Like any maverick blazing its way, the “deal” arena has quickly become cluttered with already more than 600 deal sites and the fight for market share is heating up. According to Experian, Groupon, Living Social and Eversave hold the top spots with double digit shares apiece:

    A share of the deal

    Daily deal sites are popping up everywhere from mobile and location based providers, directory companies, aggregators and even newspapers, radio and television are getting in on, well, the deal. Microsoft launched its new desktop site for its daily deals aggregation service Bing Deals on Sept. 23 featuring “more than 200,000 daily deals from sites such as Groupon, LivingSocial, Tippr, Zozi and Gilt City, as well as more than 2,000 merchants such as Nordstrom, Target Brands and Zappos.com”.

    Despite what some are calling “in-box” fatigue by consumers particularly over the summer months and a reported first time month over month drop in traffic in July, Experian’s year over year analysis of U.S visits to group buying sites revealed traffic was up overall by 163% with LivingSocial’s traffic increasing by 358% and Groupon’s increasing by 179%.

    A recent study by ForeSee Results offers consumer usage insights from its study of 22,000+ online shoppers:

    Among those who buy daily deals 31% of are new customers, 27% are infrequent customers, 4% are former customers. 38% of deals are being used by frequent customers where a retailer may be training their regular customers to become discounters and potentially eroding margins.
    Nearly half (46%) of subscribers subscribe to more than one service.
    Nearly 2/3 of subscribers have purchased at least one deal in the past 90 days, regardless of which site(s) they subscribe to.
    43% of daily deal subscribers (across Groupon, Living Social and Google Offers) are in the 25 to 44 age group while 39% are among the 45 to 64 age group.
    38% of subscribers across the sites earn $50,000 to $100,000, and 28% earn $20,000 to $50,000.

    While the landscape is filled with predominantly local businesses, a handful of brands including Quizno’s, Whole Foods, Amazon, General Mills and Betty Crocker are among the national marketers test driving daily deals amidst others who are hesitant with concerns about tarnishing brand identity and targeting the right audiences.

    With the holiday marketing season at hand and a gloomy retail outlook, local merchants, retailers, e-tailers and national brands alike may all very well be eyeing this rapidly growing channel to gain new customers, entice former customers and build awareness for their businesses.


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