Why should I spend a fortune on sales that are one-off is a common argument merchants put in when pitched by daily deal companies or couponing websites?
"No thanks, I tell them. We're guaranteed to lose money on sales to customers we'll probably never see again," Mike Scotese, a Philadelphian retailer, tells CNBC.
This is not just an apprehension retailers harbor in relation to the daily deals or specials that make them sell out half off or more, but an issue that is assuming highest proportion as the numbers of Groupon's imitators are cropping up from all sides.
Be they hoteliers, restaurateurs, masseurs, travelling agents, or goods sellers, all are unanimous on one point that their hot deals remain unable to hook up new line of bargain hunters for a long term.
Discount seekers land on to grab best deals and promise to return only when a similar kind of deals pop up in future.
Groupon's clones claim that each deal of the day is viewed by such and such millions of users and subscription list is a highlighted attraction by them.
It is not customers you reach but how you retain them does matter for businesses, said critics. Groupon's 140 million users and LivingSocial's 46 million followers pale into insignificance if they are devoid of brand loyalty in the end. And, in this way price cuts lead to a onetime bounty.
A need of change in social couponing is now being felt deeply with few of daily deal sites already initiating add-ons in the fledging group buying and time-honored reward services.
Experts call for innovation to encourage businesses to ring up B2C sales through discount promotions.
Recently introduced daily deal websites are paying heed to the advice that can redress a longstanding complain of merchants.
Reward programs by LevelUp and incentives by MOGL, both of them are deal service providers, go on with building durable business-customer relations.
Primarily, LevelUp operating in New York, Boston, Philadelphia, and San Francisco went on to promote three deals in a bid to stir up repeat business.
Later on, the daily deal site wielded an effectual change wherein instead of introducing steep discounts upfront, it supplied small ones in the beginning and then perpetual rewards on future purchases.
Did it work? According to its introducer, the model led to 45 per cent repeat customers in a pretty much amazing contrast to one per cent that Groupon was said to deliver.
Innovatively, a reward service provider MOGL bring forward three distinguishable incentives for the line of new and old bargain seekers. Cash back, gift hampers, and community service publicized to be associated with each purchase happen to foster long business-customers affinities.
Viable changes in the traditional couponing approach are essential to doll up its attractions. Above all, discount promotions can create only ephemeral buying process with no spillover effect.
Transition in customer buying pattern has to be kept under consideration. Numbers of online shoppers have scaled up 39 per cent to 870 million, as per the latest stats by Nielsen.
Author Resource:
Tariq Saeedi is a couponing industry’s analyst holding journalism and marketing degrees and contributing articles to digital and print media. Visit Dealaboo.com for daily deals , hot deals and best deals .
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