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Daily deal sites bring in new business: study

Mar. 6, 2012, Ann Arbor — Daily deal sites attract new customers and inspire loyalty, new research from customer experience analytics firm ForeSee reveals. 

March 6, 2012, Ann Arbor — Daily deal sites attract new customers and
inspire loyalty, new research from customer experience analytics firm
ForeSee reveals. 

While there has been some argument about the impact of daily deal offers on new business, according to the ForeSee report, daily deal offers do increase business awareness, purchases, and repeat purchases.

	Source: Foresee

Fifty-five per cent of daily deal purchasers were new or infrequent customers of the business offering the discount; 12 per cent of subscribers had never heard of the business prior to buying the deal. 

More than 90 per cent of web shoppers reported they had already made another transaction with a merchant company since taking advantage of an offer, or plan to do so in the future.

"No one really knew what to expect when daily deal sites first came on the scene, but our research shows that these sites are no passing fad," said Larry Freed, president and CEO of ForeSee. "Businesses that use these sites effectively are growing their customer base and customers are getting a deal, which results in a win for everyone. The challenge is for businesses to use this tool in smart ways and to work with daily deal sites who can deliver a good experience to users and merchants alike."

The clear front runner of all daily deal sites is Groupon. Groupon has more subscribers and more purchases than any other daily deal site including LivingSocial and Woot. According to the report, more than half of customers surveyed use Groupon (52 per cent); 30 per cent use LivingSocial. Despite these large percentages, there is some overlap in the subscriber base, and 40 per cent of survey respondents do not subscribe to any daily deal services.

Groupon also has the largest share of subscribers to their service alone with 44 per cent of Groupon customers reporting that they only subscribe to Groupon. Just 12 per cent of LivingSocial users subscribe exclusively to LivingSocial.