Are Daily Deal Sites Really Tools of the Devil?

Daily Deals

IMG_6393 smallYou’d think from all the hate that’s been written about daily deal sites, and how they’re now all a thing of the past as an effective way to market your local business, we wouldn’t like them either. You’d be wrong. There’s quite a bit that goes into making daily deal sites work for your local business, and a few well-publicized failures, shouldn’t end up being the reason to stop using the daily deal model. As a matter of fact, once you look closely, the lion’s share of them “failures” had a great deal in common, particularly a evident misunderstanding of exactly how to run a daily deal promotion, poor negotiation of their deals, and not keeping track of their customers redemption and spending. Given that they had epic fails in these areas, is it any wonder they failed?

But why all the hate mail?

One reason could be the financial struggles Groupon and LivingSocial have been undergoing. While they very likely will come out fine at the end of the day, financial writers excited to seize upon the harmful aspects of some daily deal sites. They regularly point to stuff like spam complaints, a glut of deals from which to choose, deal hoppers (customers who hop from deal to deal with no intention of being a regular customer) and in deal fatigue.

3 Ways you can help make Daily Deals work for your business

  • Know just how the money works! – Make sure you know how the numbers work in your deal. Determine what your average sale is and don’t attempt to exceed it with a daily deal. Also, make sure you negotiate credit card processing fees, as many of the daily deal sites will pick these up.
  • Follow up with your brand-new customers! – As many as 60-75 percent of these daily deal customers are trying you out for the first time, so it’s crucial that you have a plan to coax them back for a return engagement! Offer another coupon, and other incentives to be sure you see them again!
  • Don’t start too quickly – Begin somewhat cautiously, so you can master how the daily deal model works in your business, then scale up when the time is right.

Daily deal sites aren’t dead, you just need to know how to best utilize them for your business.