The Rise of the Daily Deal: Bargains Drive Revenue for Publishers

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Daily Deals Best Practices

As already mentioned, a daily deal is not a guaranteed home run for everyone involved. Success in marketing them depends on a variety of factors, including properly targeting the deals to the right audience, the quality of the deals, and the ability of merchants to meet the deal criteria.

Ken Kalb says that Analog Analytics makes sure to keep tabs on popular deals to make sure that they aren't getting out of hand and growing beyond a company's ability to fulfill its end of the bargain. The software also looks for rapidly growing or otherwise unusual deals and throws up a red flag if the conditions look ripe for problems. "We're constantly looking at that and touching base with the merchant and publisher, particularly when a deal is growing quite large," says Kalb.

However, Kalb notes that even that sometimes might not be enough. "There's certainly cases where a small mani-pedi shop has sold too many deals," he says. "And generally what we do is we help them to either stretch those deals out over time or, in some cases, if the consumer isn't happy, we just immediately give them their money back."

According to Wells, RapidBuyr is very fickle about the sort of deals it runs because it wants them to be properly targeted, both on its own site and to its publishing partners. "I would say we probably reject about 90% of the stuff that comes in over the transom from merchants," he says. "One guy called up and said, ‘Hey, I've got diet pills!' And we're like, ‘Uh, no. That's not our deal.' It's not really appealing to our audience."

He also notes that when considering publications for partnerships, the company looks for a few specific things. "What we would look for is a very engaged audience," says Wells. "And we'll try to take that engaged audience-it doesn't have to be huge, it doesn't have to be millions and millions of people. But it should be engaged, it should be coming to the site a lot. And there should be some active communication going out to the users beyond just the webpage itself or the print product."

According to Tobias, the best publishers for daily deals programs are those that are in some way involved with commerce to begin with. "The best kind of publishers to get into the daily deal business are ones that publish something that generally has to do with commerce, or it has people in sort of a buying mood. So review sites, entertainment sites, going-out-on-the-town sites, [and] event publishers," he says.

According to Blossom, group buying may be popular for the moment, but it's too early to say if it has staying power because this type of marketing is still so new. "Social media-oriented marketing is still in its infancy," he says. "And people are going to be excited by specific models that work well. Sometimes some of the magic will rub off, especially when people begin to look at the hard financials."

He also thinks the future might bring other social and locational advertising methods, which could potentially outperform group coupons. "The group coupon thing is powerful. It's kind of the first hot one. But new hotness does not necessarily mean the only marketing mix in town," says Blossom. "There's going to be a lot of marketing mix-true, personal, location-centric, transaction-oriented marketing."


Analog Analytics

Groupon, Inc.


RapidBuyr, LLC

Shore Communications, Inc.


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