The Effectiveness of Daily Deals
It is amazing how quickly a good idea can catch on on the internet. One recent example that comes to mind is the daily deal website. Sites like Woot, Groupon and Living Social are some of the forefathers of this movement. Each of these examples have a variation of the daily deal, but in essence they are all the same. An Item or service is posted daily and users have the opportunity to purchase the item at a deeply discounted price.
How effective is this sales technique. Apparently it is working out very well as it is being duplicated all over the web. Recently Ebay has jumped on board, a local Salt Lake City television station is now offering daily deals, even a SCUBA website I frequent is offering deals until Christmas, and many many more.
So why does this work? It is simple... Individuals purchase on impulse. Shortening that window of opportunity and offering a limited amount of items doesn't give the customer time to think about it. It is either jump on it now or risk missing the deal. The low prices make it an even easier purchase.
As a daily deal addict I have found myself buying items that I don't know if I will ever use. The thrill of the deal drives customers to return daily to find the next bargain. So how does this work for the retailer? After talking to a service provider that I purchased from on a daily deal website. He revealed to me that nearly one third of customers who purchase the items or services on a daily deal website don't claim their item before the expiration date. This is why these items or services can be sold at such discounted prices. So it's a win win for the customer and merchant.
Keep your eyes open. You never know when or where the next deal might pop up.
Are you a merchant interested in offering daily deals on your website? Contact Luna