If you don’t believe me, then believe Bloomberg, which reported on a survey run by Manta, the small business listing service, that found of its 1,087 members surveyed 82 percent do not intend to run daily deal promotions this year, and only three percent said such campaigns garnered any repeat business. Three percent said they lost money on daily deal coupons.
On face value, it sounds like a grand idea. Here’s a way to advertise your business and get potentially large numbers of new customers walking through your door without any upfront costs. That brings an old axiom to mind: if it sounds too good to be true, it probably is. And, in the case of daily deals, it is.
The problem with daily deal sites such as Groupon and LivingSocial (and innumerable clones) is that their users are loyal to deals, not to the businesses that provide them.
But the real problem runs even deeper; deal buyers don’t come back.
With the deep discounts and slim margins, not to mention the money owed to deal sites, small business owners can’t make a profit, especially when those deals don’t result in repeat business.
But with every problem comes an opportunity. And the opportunity here is to create a system that converts one-time coupon users into repeat customers. The daily deal purveyors have yet to do it (they take their money and run), so that leaves someone else to craft a solution.
Believe me when I tell you my mental wheels are turning in hopes of coming up with a feasible solution. But I can use your help. What ideas might you have to finding a remedy to this no repeat business malady? If you have one, please leave a comment.
Perhaps between us, we can hand small businesses owners a golden key that unlocks the door to daily deal success. In the meantime, my advice to businesses – send the daily deal salespeople who visit you right back through the door.