Daily Deals and Flash Sales Sites Find Niche

Discussion
Jun 22, 2011
George Anderson

You may have noticed that a growing number of daily deal and flash sales sites are getting more targeted in their approach.

Exclusively In offers “The best in Indian fashion, home decor and travel. We are on the frontlines of the most inspired styles coming from India, discovering and delivering the latest designs and truly singular experiences.”

Totsy chief merchandising officer David Niggli told RetailWire earlier this year, “The major difference for Totsy is that it’s targeted to a specific audience, which is moms and families and children. Our product is all geared to the family space. So whether that’s toys, apparel, baby gear, room décor for the child for mom for the family. We have things for mom whether its beauty products or accessories and even dad’s watches and diaper bags and things like that.  But it all really has to fit in the life style of a family.”

Lifebooker, with its Beauty Covered. “Prices Stripped.” tagline ferrets out “exclusive health and beauty deals” in New York and LA.

Sports fans in Boston, Chicago, New York, Los Angeles, San Francisco and elsewhere can now take advantage of daily deals with savings between 50 and 90 percent on seats to sporting events, according to a Springwise report.

Justin Cener, founder and CEO of Crowd Seats, told Business Insider: “Sports ticket inventory is very similar to hotel inventory – if you don’t sell it, you lose it. Crowd Seats enables teams to generate significant revenue from otherwise perishable inventory. Moreover, unlike traditional businesses, sports teams generate large supplementary revenues after the ticket is sold through parking, concessions, and merchandise, making the sports industry the perfect partner for daily deals.”

Discussion Questions: Do you think more targeted/niche daily deal and flash sales sites will be the trend going forward? Are these sites more or less likely to succeed because of their focus?

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11 Comments on "Daily Deals and Flash Sales Sites Find Niche"


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Dick Seesel
Guest
9 years 10 months ago

Targeted “daily coupon” sites fit right into the evolutionary cycle of retailing. In the days of pure bricks-and-mortar, retail evolved from mass appeal (department stores and general merchandisers) to more targeted big box specialists. (There are relatively few general-appeal “nameplates” compared to 40 years ago.) You can point to the same trend in e-commerce, with targeted websites driven by a wealth of information about consumer preferences vs. sites aspiring to be “all things to all people.

The same trend is happening fast on the “daily deal” front, even from sites like Groupon or Living Social. The trick is to ensure that the micro-targeting is not so focused that it misses some broader volume potential, and also to ensure a profitable outcome for participating merchants.

Max Goldberg
Guest
9 years 10 months ago

It makes sense that daily deal sites would become more targeted, either geographically or demographically. Even Groupon and Living Social, the two biggest daily deal companies, offer highly targeted packages to merchants.

One Kings Lane has been very successful in targeting home furnishings and decor.

If these sites can build a loyal following, there is no reason why they cannot generate significant sales and be profitable.

Bob Phibbs
Guest
9 years 10 months ago

Targeting is now happening in the wholesale gifts market with Bigger Box with 1/2 off wholesale to retailers started by some reps. Is this where everything is headed? It is until every business model is upended to conform to price.

Matthew Keylock
Guest
Matthew Keylock
9 years 10 months ago

Just being a niche player is rarely the key to sustainable success. The overall proposition in terms of value and relevance to the customer is essential too, as is finding a profitble business model! Competition will come from new players and expansion of big players, so pressure on niche providers to innovate to stay ahead and/or to remain an attractive merger-acquisition option will be intense.

Dan Frechtling
Guest
9 years 10 months ago
I like Richard’s framework of evolution. Here’s another view: if we look at social media or vertical content sites as analogies, here’s what may happen: *DIY software enables myriad turnkey daily deal sites to hang up shingles*Niche properties proliferate like targeted communities*Users form their own deal cohorts (like LinkedIn or Facebook “groups”), first sharing deals among each other and later being targeted directly by merchants*The large players extend into sub-brands to pick up niche enthusiasts*Aggregators try to organize all of this confusion like social search engines The constraint in this case will be content to fill all the new inventory. A paper released last week by Utpal Dholakia at Rice suggested less than half of businesses that ran daily deals were enthusiastic about doing so again. (Though nearly 3/4 would consider a different daily deal site). Medium term there will be a lot of activity and long term we’ll end up with a pyramid of a few elite super-networks at the top and a constellation of 1-2 dominant sites per genre, geography, etc., at the… Read more »
Dan Berthiaume
Guest
Dan Berthiaume
9 years 10 months ago

There is room for both kinds of daily deal sites, just like in the brick-and-mortar world there is room for both general merchandise retailers and niche-specific “category killers.” The general daily deal sites will appeal to the casual shopper just looking to see what’s on sale and the targeted sites will appeal to the more focused shopper with a specific interest or need to fill.

Tim Henderson
Guest
Tim Henderson
9 years 10 months ago

Groupon is good. But the glut of niche daily deals feels like too much of a good thing. Choice fatigue has set in, and consumers now want to streamline their daily deal hunting.

Going forward, shoppers are more likely to sign up for one or two daily deal sites that offer a variety of deals covering their overall lifestyles. And some may complement those offerings with a select few niche daily deals from brands that really align with their personal passions, e.g., tickets to sporting events for the sports fan.

Jonathan Marek
Guest
9 years 10 months ago

Targeting is a double edged sword. One side is obvious: the targeted offer is more relevant to customer. The other is more subtle: the targeted offer is more likely to be sent to someone who would have spent anyway. That non-incremental redeemer typically creates a massive profit that requires several incremental redeemers to overcome. Whether one effect is greater than the other varies by business, but is quite testable.

Rick Boretsky
Guest
Rick Boretsky
9 years 10 months ago

I’m going on a limb here–daily deals are dead! Bottom line, it is not good for the retailer and therefore is ultimately not good for the consumer. It is not even clear yet that the daily deal companies can make this a profitable business. Retailers need to focus on their own promotional strategy with effective marketing, pricing strategy, coupons, and promos. I am sure there will always be a small place for lesser known establishments to try and drum up some new business with a daily deal site, but it will become very niche and very limited.

Tony Orlando
Guest
9 years 10 months ago

Some of these sites do quite well, and if the shipping costs are reasonable, repeat business will be there. I have used to some online bidding sites and have gotten some really good deals, so let the best site win!

Kai Clarke
Guest
9 years 10 months ago

This is the trend of the future. Targeted deals, differentiated target markets, with a short window of opportunity. This drives a clear call to action, every day with a new product and pricing to keep the audience coming back for more.

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