Don’t you love a bargain? I practically jumped out of my shoes when my local CVS gave me a free bottle of vitamins last week. Of course, first I read the fine print on the coupon that came out of the register when I used my CVS Extra Care Card. And no kidding: it really was a ten-dollar coupon for vitamins with no strings attached.
But the story is usually about the strings, not the bargain.
I’m not talking about CVS having a record of my purchases and the trade-off that’s inherent in that. While I absolutely disagree with the Facebook-esque view of the world where everything that everyone does is up for grabs by anyone who cares to look, I long ago decided that getting discounts by giving information to retailers who had a whole bunch of information about me anyway was OK. Are you listening, ShopRite?
I’m talking about the Daily Deals sites that have cropped up all over the Internet. Sure, there’s Groupon, and there’s everybody else; you knew that. And yes, the question of whether Daily Deals “coupons” expiring is legal is one that we’re going to be grappling with for a while. But the larger question, regardless of how this nascent industry shakes out, is whether it can survive—at all.
Business Change? You Bet.
In this piece at TechCrunch, a Daily Deals site insider runs the math. And that math isn’t about the consumer at all; it’s about whether it makes sense for businesses to offer Daily Deals through places like Groupon. Recently, there’s been a lot of talk about how bad a deal working with Groupon is for the companies offering Daily Deals, and if you believe this math, it’s not a bad deal at all; as a salesperson at one Daily Deals site pointed out to me while trying to get us to offer one, Daily Deals are a marketing expense—not a way to make money directly—and this math suggests the Daily Deal to be a viable idea.
Now as the author points out, he’s biased. And having run a restaurant once upon a time I can tell you that his assertion that food costs are 30% of a meal’s price tag is too low (and skews his numbers to meet the point he’s trying to make). But from a business change perspective, let’s give the Daily Deal its due:
The Daily Deal Is a Great Way To Acquire New Customers
If your business is in customer acquisition mode, I can’t recommend trying a daily deal once or twice highly enough. We’ll even help you navigate the waters; contact me here for help offering a daily deal, the right way.
But please understand that the art of the Daily Deal is all about negotiation, and having the right expectations.
Oh wait, that’s where I started: the Daily Deal is all about business change.