Editor’s note: This article was first published in July 2011, at the height of the daily-deal boom. The sites it names, LetsBonus, Groupon and Groupalia, and the market itself have changed a lot since.
The discount coupon craze keeps growing, although some of the businesses that advertise on these sites still aren’t clear on how to make them pay. They tend to build their strategy around “sell more and earn more”, which is very hard when you launch an offer on a product that is sometimes discounted by as much as 90%.
You can test this by visiting some of the best-known discount coupon sites, such as LetsBonus, Groupon and Groupalia, where you’ll find incredible offers in your city from businesses you probably didn’t know about or didn’t even know existed. That’s where the value of these sites lies.
It’s a matter of working out what it would cost us to advertise in a medium that reached our whole province, and in some cases the whole country. In our view, and as Guillermo Lliure, managing director of Groupalia, also pointed out, we should focus on advertising our business and design the right strategy for using these discount coupons to make our business known (whether or not we make money on the deal), with a stronger focus on customer loyalty.
That way we avoid some nasty surprises when we do the sums after the “avalanche” of customers drawn in by the coupons and find we haven’t made a profit.
It’s hard for a business to make money on a discount of 70% or more. But if we turn a high percentage of those customers into regulars, the advertising strategy will have turned out very cheap, and at least they now know our company, bearing in mind that these sites get a lot of daily visitors.
Further reading
Featured image: Carol Pyles from Winter Haven, FL, US, CC BY 2.0, via Wikimedia Commons.
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