Fab.com Deploys the Big Gay Deal of the Day

Discussion
Feb 22, 2011
Tom Ryan

Fab.com, a gay fashion, style and culture website, recently launched
a new daily deal service that functions much like Groupon and LivingSocial,
but specifically offers steep one-time discounts on products and services geared
for gay men.

Called the Big Gay Deal of the Day, two deals — one specific
to a U.S. city and another national one — are featured each day. The service
debuted on Feb. 1 with a national deal offering $30 worth of underwear for
$15 at Baskit.com. Fab has since offered national discounts on Out magazine
and Slick It Up clothing, along with gyms, spas, bars, restaurants, hotels,
events, entertainment and merchandise “that
would never turn up in mainstream daily deal programs.” 

It also launched
a local daily deal in New York City and will also be offering daily-deals in
gay-friendly cities such as San Francisco, Los Angeles, Atlanta, Miami, Chicago
and Washington, D.C. The local deals spotlight gay-owned and gay-friendly businesses
as well as gay-specific products, services and hot spots in each city.

Much
like Groupon, a minimum number of deals must be purchased for the promotion
to kick in for everyone.

“We created the Big Gay Deal of the Day after seeing and rejecting the
99th Groupon deal for things like Domino’s Pizza, lash extensions and straight
dating services,” said Bradford Shellhammer, co-founder of Fab.com, in
a statement. “Gay
men are looking for bargains like everyone else, but we weren’t receiving gay-relevant
offers even though the gay community purchases $700 billion worth of goods
annually in the U.S. alone.”

The Wall Street Journal noted that the launch of Fab’s daily deal service
follows the launch of other niche daily-deal websites, including Jdeal.com,
a Jewish discount site; CamoFire.com for hunting enthusiasts; CigarMonster.com
for cigar fans; and Paws4deals.com for pet discounts. For foodies, DailyGourmet.com
is expected to launch soon.

Discussion Questions: What’s the likelihood of daily deal services will increasingly target more distinct niches or lifestyles? What are the pros and cons of daily deal sites targeting more specialized audiences versus more mainstream sites such as Groupon and LivingSocial?

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11 Comments on "Fab.com Deploys the Big Gay Deal of the Day"


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Bob Phibbs
Guest
10 years 2 months ago

We are witnessing not a new way to shop but a bubble marketing of deals….

Anne Howe
Guest
10 years 2 months ago

Many folks that identify themselves with a niche group will like the concept of specific deals targeted directly to them, but I wonder if the shopping velocity can sustain business models built around such specificity. When it comes to gay men and shopping, however, I think the generalization and the reality are far closer and therefore more likely to succeed. Daily deals for fly fisherman and big-game hunters…perhaps a little too narrow to have sustained impact for the advertisers.

Bill Emerson
Guest
Bill Emerson
10 years 2 months ago

This is a natural evolution of the deal sites. Think of it as the equivalent of localization or CRM deals based on individual shopping history. Any time you can increase the alignment between the offer and the preferences of the customer, you will get a better response. The challenge, of course, is finding an audience of sufficient size by geographic area. I would expect that Groupon and the other big players are beginning to parse their lists into affinity groups. If they aren’t, they should be.

Ben Ball
Guest
10 years 2 months ago

I certainly agree with Anne’s overall sentiment about these “daily deals” getting over cooked as they target more specific audiences. But I had to chuckle at the example she chose. Ironically, Sportsman’s Guide is one of the originators of the “weekly deal” email (granted, not daily) for their shopping club members. Each weekly deal has a theme (cabin & home; optics; ammo; etc.) and features about a dozen items.

A relatively unknown Minnesota start-up a decade ago, Sportsman’s Guide has emerged from a discount/close out monthly catalog mailer outfit to one of the top online retailers of outdoor gear. It certainly isn’t Groupon–but it is apparently very successful. Point being, I don’t think we should underestimate the potential of carefully targeted special interest marketing. Even relatively small groups can be profitable with the super-low cost of online offers.

Lee Peterson
Guest
10 years 2 months ago

Good idea, depending on market size or what your goals are. This one, in particular, seems like a very good idea though. I just hope they “let” us metro-sexuals in on the deals. Style is so hard to come by!

Gene Detroyer
Guest
10 years 2 months ago

From a mass perspective, the marketers at GroupOn or LivingSocial would be ecstatic if they generated a 1% response on their email blasts. I don’t know what the redemption rate is, but I guess a successful offer is probably measured in 100ths of a percent. That may be a good business proposition, but it is a horrible consumer proposition. The consumer can better that proposition by choosing more targeted offerings. Ultimately, they are going to see ONLY what they want to see.

Gays, mothers of 2 year olds and even fisherman will be getting only the offers they want, not the ones the marketers want to send them.

Despite the hype, GroupOn currently has no sustainable competitive advantage. They are being copied and will continue to be and those who are starting up with a better, more targeted (read that alluring) will surpass them.

Camille P. Schuster, PhD.
Guest
10 years 2 months ago

Providing group discounts via the web is a hot topic at the moment and there will be many more services offered aimed at many niches. Long-term success is still in question. Recently there was an article about GroupOn saying that businesses are not continuing their service with GroupOn. They made a number of sales with their highly discounted price but that did not bring consumers back to their store for other purchases. Sounds like typical short term sales results: if you train consumers to look for a deal they will learn to do that and long-term loyalty suffers.

James Tenser
Guest
10 years 2 months ago

Self-selected deal relevance is hard to argue with. Like others here, I think it will come down to matters of scale and distance: Are there enough members in the targeted group to sustain the business model? Also, are the group members’ product affinities sufficiently different from the mainstream?

Tim Henderson
Guest
Tim Henderson
10 years 2 months ago

In general, I’m a fan of social couponing. But I have been urging brands to also be mindful that consumers may eventually grow weary of the increasing number of daily deals–ultimately experiencing more aggravation from needing to make more choices vs. the delight that comes with scoring a great deal.

I think consumers will ultimately look to a small number of daily deal sites that offer bargains on an variety of products and complement those with a smattering of niche daily deals that are specific to the consumer’s lifestyle, e.g., green deals for green consumers. So in that light, the Fab.com deal a day may be a winner. But then, I’m sure there are more niche deals on the way.

Ed Rosenbaum
Guest
10 years 2 months ago

This is an excellent idea and promotion. Gearing to a group purported to having a large disposable income and certainly trend setters when it comes to fashion and style is smart. My guess is this will take off and spread to many other large buying groups quickly.

Ryan Mathews
Guest
10 years 2 months ago

Ah, how about daily deals for libertines? We could call it Gropeon!

Pitching any promotion to a significant niche of customers is always a good idea, provided the customer wants to be associated with the group.

The danger inevitably is that it’s easy for stereotypes to creep in and then the promotion, intended to reward, actually backfires.

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