Posts Tagged ‘daily deals’

LSA|14 Speaker Spotlight: Laura Rich, CEO, Street Fight

Monday, March 17, 2014

Laura Rich, CEO, Street Fight

Today’s Speaker Spotlight features Laura Rich, CEO of Street Fight.  Laura will be moderating a panel at the 2014 Local Search Association Conference in Huntington Beach, Calif., April 27-29, and we are really looking forward to the session.

During her panel, titled, “How Digital Offers & Couponing Help Customers Find Locations,” Laura will lead panelists beyond traditional search to discuss the key way in which consumers are finding businesses: through commerce and offers.  So far, panelists include Christian Gaiser, CEO of Bonial International Group-Retale, and Ben T. Smith, IV, CEO of Wanderful Media.

We asked Laura for a sneak peek into her session and here is what she had to say:

What are the key topics you’ll discuss during your session?
We’ll talk about the oft-mentioned “Starbucks example,” where relevant mobile offers and coupons are given to consumers at just the right moment, spurring action — and how the mechanics of digital offers can make people try new locations and become more loyal.

What about your session are you most excited about?
In the wake of the daily deals rise and fall, there’s a lot of skepticism in the market about couponing.  Nonetheless, prices and sales remain the key drivers in getting people to buy things. While digital deals and offers may have taken a bad rap, there is still a lot of white space in the marketplace for those deals and offers that can bring people in to small businesses, both as new customers and as repeats.

Why is it important that attendees not miss your session?
As companies like Groupon, LivingSocial and many others buy keywords, offers and pricing increasingly become part of a consumer’s local search experience. When customers search for businesses, they are often looking for deals and comparing products and inventory. In this kind of advanced search, deals and offers become key drivers for conversion.

Click here for more information on the LSA|14 conference.

Groupon’s Deal Builder Helps SMBs Help Themselves to Daily Deals

Tuesday, February 25, 2014

A few weeks ago, Groupon launched Deal Builder which is a new self-serve tool that allows business owners to create deals and offers that become a part of Groupon’s daily offering. Groupon is hoping the tool will help broaden the types of businesses using the platform, such as those not located in major urban areas outside of Groupon’s normal sales reach.

Offers that are created through Deal Builder tend to have a lower audience, as they aren’t sent out in one of Groupon’s main e-mail blasts or notifications.  While at first blush that might seem like a drawback for Deal Builder, local merchants in the past have been unprepared for the high volume of traffic that Groupon e-mails can create.

Deal Builder may also help SMBs improve their ability to connect with consumers on mobile devices.  Mobile Commerce Daily recently highlighted an SMB’s offer on Deal Builder that resulted in half of the redemptions coming from mobile devices.

Despite Social Media Examiner’s study released last year that found 80% of marketers don’t plan on using a daily deal site, Deal Builder opens the door for more SMBs to experiment with daily deals at their own pace.  The self-serve model takes away the hand-holding that was needed to create deals, takes away any sales pressure, and offers customized solutions selected by the SMB itself.

For Groupon, the tool improves its ability to house more deals and generate more locally focused content.  Similar to all the recent news related to Yahoo’s local search capabilities, Deal Builder further solidifies Groupon’s standing as a legitimate local marketing solution for SMBs.

“With the launch of Deal Builder, we now have a customizable solution for the thousands of merchants that contact us directly every month wanting to run a deal,” said Dan Roarty, vice president of product development at Groupon.

Since SMBs can’t compete with the marketing budgets of national brands, it helps to have solutions like Deal Builder that get them in the mobile ad and search space without devoting a lot of resources.  In addition, by having more control over the direction of deals, SMBs can use their local knowledge to develop customized and relevant offers.  It will be interesting to see if Deal Builder does help Groupon break into and catch on with businesses in smaller markets.

BIA/Kelsey Leading in Local: Groupon Interested in Being More than Daily Deal Site

Friday, December 13, 2013

Today 500,000 merchants work with Groupon. While that sounds like a big number, Groupon sees much greater opportunity in the space with 30 million local businesses out there.  And while Groupon is best known for its daily deals, it is interested in becoming much more than that.  As we’ve heard so many times at the BIA Kelsey Conference, Groupon is seeking to leverage its existing business into leads for other marketing services.  Sean Smyth, SVP of partnerships at Groupon, acknowledged that in order to reach their goal of becoming a platform as opposed to an event based service, it must work with other companies in the local space.

What spurred this service expansion?  It was Groupon’s experience with daily deals as a demand vehicle.  Merchants would use Groupon to drive demand for their services, but Groupon was in many cases too successful creating fulfillment issues for the business.  In order to help avoid problems like this, Groupon had to learn the business of those they were helping, and in some aspects, it had to know the business better than its owner since the merchants had often demonstrated an inability to forecast the impact of its offers. In learning the business, Groupon discovered there were so many other inefficiencies that existed within small business, many of which were areas where Groupon felt they could help.

Another driver for change was the realization that the daily deal product provided limited engagement with the merchant.  While 50% of merchants that run a deal on Groupon followed up with a second deal, that still only constituted a single digit number of engagements.  Groupon wanted to work not on driving single events, but on something that could be a constant service, a platform.

So, Groupon acquired Breadcrumb to expand its services.  Breadcrumb is a restaurant tool and an investment in the future to improve Groupon’s value chain.  Breadcrumb is on its way to being the operating system for local businesses to provide services like POS, payment services, and a reservation platform.

But as they build the supply side of their business (now a marketplace of 65,000 deals per day just in N. America), Groupon is again looking at the demand side, and that is where partners can help.  They have a partner program – a global platform where partners can incorporate or add Groupon offers and deals into their own marketing tools or services to reach consumers.  It will be interesting to see if Groupon can successfully expand the service that made it so popular.

As Local Search Goes Mobile, Search Engines, Yellow Pages, and Store Circulars/Email Promotions/Coupons Top Local Media Reach

Tuesday, July 2, 2013

Today, we are releasing results from our annual “Local Media Tracking Study,” which provides key insights into the reach of various local media sources. In this first of two blog posts, I discuss results related to local mobile usage and overall local media trends; in the second post, I do a deep dive into results on Yellow Pages usage.

Our study, which was conducted by Burke, Inc. throughout 2012, showed that while U.S. adults increasingly turned to online sources for local business information, the most significant growth was in use of mobile phones/smartphones and netbooks/tablets for local search. The research reinforced the results from our “Local Mobile Search Report,” which illustrated a continuing shift to mobile usage among consumers in the local space, at the expense of stationary computers and laptops.

Results show consumers are best reached through an integrated advertising approach that leverages both online and offline media. The study found that as the number of local online media increases (Ratings & Reviews and Daily Deals were added to the survey in 2012), both online and offline media continue to attract sizable consumer audiences.

(Click here to view and/or download PDF version of infographic.)

Here are my key takeaways from the above results:

  • Consumers are going mobile and businesses need to follow. In order to keep up with consumers’ increasing use and affinity for mobile devices when searching for and purchasing products and services, it’s important for local businesses to ensure their online efforts support key mobile devices and introduce smartphone- and tablet-friendly websites in order to remain competitive and attract new customers.
  • For those on a budget, businesses should focus on making their websites mobile-friendly or mobile-responsive before considering mobile applications.  However, mobile applications certainly have strategic advantages and may be better suited in some circumstances, such as if the website is repeatedly and/or heavily used as part of a service being provided.
  • Local businesses should strive for an integrated, wide-ranging presence across online and offline media in order to reach their target consumers wherever they search, keeping in mind that offline media continue to generate high results when compared to new online media. As an example, see my next post on the study’s Yellow Pages result.

10 Questions Local Businesses Should Answer When Considering Online Deals

Monday, March 4, 2013

If you’ve followed headlines about the online deals space over the past year, you might wonder if the phenomenon has lost its appeal.

In our monthly Locals Only column on Search Engine Land, I discuss that while the industry is facing challenges, both local businesses and consumers continue to see promise in the medium. I lay out 10 key questions that local businesses should consider when deciding whether an online deal makes sense for them.

Read my full column at Search Engine Land.

BIA/Kelsey: Daily Deal Spending to Rise 87% in 2012

Tuesday, September 25, 2012

Consumers are becoming daily deals junkies – checking sites like Groupon and Living Social each day and awaiting the daily e-mail from platforms like Gilt City and Google Offers to see the latest deals in their city.

Last week, in the midst of SMB Digital Marketing 2012, BIA/Kelsey released a new report projecting that daily deals spending will rise by 87% in 2012 alone. U.S. consumers will spend $3.6 billion on sites like Living Social and Groupon by the end of the year.

BIA/Kelsey expects the daily deals space to grow an additional 23% in 2013 and projects that it will become a $5.5 billion industry by 2016.

Growth in this area presents a major opportunity for small business. Stay tuned.

SMB Digital Marketing 2012: Groupon’s Sanjay Gupta Dispels Some Common Misconceptions about Small Business

Tuesday, September 18, 2012

Sanjay Gupta., VP – Global Merchant Marketing, Groupon, described their approach to winning new clients for the daily deal.  He made the important point that the term SMB can be very broad – it covers a multitude of business owners from the one person kiosk to much larger, more sophisticated concerns, and each has differing needs.

His formula for reaching merchants seems to contradict accepted tropes about small businesses:

Keep it simple – everyone talks about how busy SMBs are.  Groupon has found that they may be busy, but SMBs will spend time to learn complex ideas. He addressed what he thinks are some common misconceptions about small business:

Very Concerned About Price – Groupon has determined that with trust, SMBs will pay for product/vendor stability.

Don’t Have the Time – Gupta says that merchants will find the time for critical needs.

Know it All or Not at All – maybe, but he says that Groupon’s experience is that SMBs are willing to learn.

Groupon specializes in small, “Mom and Pop”, local merchants and is winning them over through 5 main tenets –

  • Make them successful and your success will follow
  • Support – provide both sales and account support, as well as self-serve and self-prep options
  • Empower the merchant with tracking tools – a merchant center and customer interaction tools
  • Continue that support through lifecycle management
  • Align your strategy and offerings with the evolving needs of SMBs

BIA/Kelsey anticipates strong grown in the daily deals space over the next few years as large businesses enter the fray and add their loyalty programs to the mix.  Meanwhile, it appears that Groupon is continuing to reach SMBs of all sizes with a combination of new tools and traditional customer care.

#DMS2011: Interview with Brett Truka, Groupon

Thursday, September 22, 2011

Brett Truka, regional sales manager at Groupon, provided a behind-the-scenes view of life inside the originator and largest daily deals provider. According to BIA/Kelsey, Groupon represents 58-60% of the daily deals space, which currently comprises more than 600 daily-deals providers.

Truka said that Groupon’s sales team, made up of reps ranging from backgrounds in newspapers and Yellow Pages to recent college grads, generally goes by a model ensuring 70% of reps time is spent inside the office contacting local businesses by phone, and 30% outside in the field.

Every day, Groupon needs to put out a deal in each of its markets. Truka talked about daily pipeline meetings in each regional office where Groupon managers and reps take a look at their specific market needs, and listen to where reps are in the process of securing deals with local businesses that fit those categories. Following the meeting, reps reach out to CRMs to finalize lists of businesses in those categories and then reach out to strike a deal.

BIA/Kelsey estimates that 54% of Groupon’s deals are for restaurants, something that Truka doesn’t see changing since consumers love to dine out. But he did say that Groupon is moving beyond its initial deals focused just on fun things to do locally, and branching out to local services that people need and get excited about.

Truka said that while many local businesses have heard of Groupon, most don’t know how the process works. Groupon’s reps work with business owners to structure the right kind of deal for their business, one that takes into account the volume of business and dollar discount that they can handle. Truka said that Groupon also helps manage redemption. Recentlly, the company launched iPhone and Android apps that allow merchants to scan Groupon barcodes and track redemption in an online merchant center.

BIA/Kelsey estimates that daily deals revenue will grow from $873 million in 2010 to $4.2 billion in 2015, so there is enormous opportunity for Groupon to continue to grow. But with so many competitors entering the space, it will be interesting how its future plays out.

#DMS2011: SMBs and Deals: The Next Wave

Wednesday, September 21, 2011

This afternoon the BIA/Kelsey team gave an update on the daily deals forecast, which Peter Krasilovsky, VP and program director, projected will reach up to $6 billion in annual deal revenues by 2015.

Despite some media scrutiny of the daily deal space, BIA/Kelsey remains confident that the biggest successes are yet to come, stating in today’s presentation “the deal a day industry is poised for strong growth.” Mark Fratrik, VP and chief economist, attributes this to 1) an increasing focus on providing consumers with more personalized and geo-targeted opportunities, 2) businesses’ likelihood to move resources from other advertising vehicles toward this as a marketing option; and 3) the expansion and subdivision of sites, which will also help to combat consumer fatigue some providers are experiencing.

Yipit estimates there are around 600 companies in this space today. With the barriers to entry so low, we’re probably going to see this figure continue to rise for a number of reasons:

  • The huge mailing lists daily deals providers maintain. Did you know Groupon’s email count in Chicago is bigger than the combined circulation of Chicago Tribune and Chicago Sun-Times?
  • The “no money down” model makes entry simple and low-risk to local businesses
  • The deals model reinforces SMB advertising value
  • A new ability to target local customers on vertical and national basis
  • The space continues to become more credible to consumers. Where consumers wouldn’t have accepted or acted upon an expensive travel deal a year ago, they may do so today.

As we’ve regularly blogged this year, traditional Yellow Pages companies are already embracing this model to reinforce existing advertising relationships. Sales representatives can use group buying as a point of entry to a local business advertiser, and advise on a strategy behind it that will continue to deliver results long after the deal has passed.

#DMS2011 Interview with Todd Rose, AT&T Interactive

Tuesday, September 20, 2011

BIA/Kelsey’s Charles Laughlin interviewed Todd Rose, VP, Business Development, AT&T Interactive, who is part of the team rolling out AT&T’s Deal of the Day offering. AT&T initially launched daily deals in three markets – Atlanta, Dallas and Los Angeles – and hopes to expand to 10 this quarter.

Rose said that the unique advantage of AT&T’s offering over pure-play competitors like Groupon and LivingSocial is its sales management infrastructure, which allows AT&T to easily roll out products nationally. He said AT&T’s challenge is not access to merchants, but to customers – something the company is trying to overcome now through e-mail, referral marketing and other efforts.

Rose described the company’s initial success in its three starter markets, which are all returning healthy margins and now have significant backlogs of deals. AT&T is currently reviewing the success of its first deals – conversion rates, etc. – which Rose said are encouraging. The company is currently using sales reps dedicated only to deals, but will test whether deals can be sold as part of a traditional rep’s comprehensive portfolio of local offerings.

Additional highlights from the conversation include:

  • According to Rose, the overall objective for deals will be to help merchants acquire and retain customers on a long-term basis.
  • AT&T has already partnered with Foursquare, and will continue to look at other partner opportunities in the deals space
  • Tier-two markets, which are less saturated with daily deal offerings, might be better entry points than larger markets, such as New York City, which has 150 daily deals sites alone
  • Deal fatigue is a real issue, that’s why AT&T is capping the number of deals per merchant. Rose said that pure-play daily deals companies max out every deal – even when it makes sense for a local merchant to do so – because it’s their only revenue stream