https://www.youtube.com/watch?v=Vgk1YfInZoM
Daily deals have been really popular in recent years. Some famous deals site are Groupon, Living Social and Teambuy. Business is booming for these sites and I believe their timing with the economic difficulties has helped them tremendously.
People are always finding ways to save money and one way is through deals.
People now base their entertainment and vacation based on what deals are available. In short, people are letting deals control their actions and what they consume.
Some people only go to restaurnts that offer deals on these sites. I believe that bringing this to developing countries like Asia and Latin America will help them further in their business.
People from these countries have less disposable income and deal sites can help them tremendously.
Here is the Groupon superbowl ad.
Sure as a consumer this is fantastic, but for businesses these daily deal sites can be predators! With the tougher economic times, businesses are also feeling the strain and impact of decreased consumer spending. On the one hand they feel compelled to offer daily deals in order to compete; however, this form of marketing can be very damaging. The idea is that a business will discount their prices and get a large audience of consumers to purchase these deals. Before they can take this revenue, they have to share it with the daily deal site, and are often left with insufficient funds to cover the costs of offering the deals in the first place! Sure there is a chance that a customer will enjoy the experience and return to pay at the full price however, it is common for this type of customer to lack loyalty. They will go wherever the next deal takes them regardless of their previous experiences.