Do Daily-Deal Sites Like Groupon Work for Local Businesses?
LivingSocial, Amazon Local, and small companies
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“Companies need to move beyond the preconceived notion that Groupon users are just bargain hunters. We have a very high-end brand and I think our experience is proof that you can bring in Groupon buyers and make them regular clients as long as you have impeccable service,” Demirjian says.
At the opposite end of the spectrum are people like Steve DiDio, owner of Pleasantville fitness studio and sports medicine center Physical Fitness Xperts (pfx), who ignore the potential customer-retention issues because of other gains. DiDio has offered deals through Amazon Local and LivingSocial and achieved retention of only about 10 percent. But, he says, even a person simply coming to his facility to take 10 spin classes for $20 can be a benefit. “Even if they don’t join the gym, that customer now knows that we also offer physical therapy and massage and maybe they will need those services in the future, or recommend us to someone else who does,” DiDio says. “That type of soft ROI is invaluable.”
Ultimately, each business must decide for itself whether running a promotion on a daily-deal site will be an effective marketing vehicle or a waste of time. Whichever conclusion they come to, they are likely to have plenty of company.
Amy Roach Partridge is a veteran business writer and editor in Thornwood whose daily-deal addiction is now well-documented.