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Small Business Marketing Tips: Don’t Let A Deal Site Ad Campaign Bankrupt Your Business!

May 3, 2012 · 6 comments

in Business

Deal Site Ad CampaignsEveryone loves a sweet deal on a product or service especially at over half the going rate. As an avid researcher for a site comparing internet fax services, I come across tons of deal related information and websites and I have to admit, I’ve been roped in and have taken advantage of a few Groupon deals myself. But with all the trouble websites like Groupon have experienced, is this form of free advertising benefiting the small business owner or creating epic business failures or even worse, complete business shut downs?

A Few Quick Stats on Group Deal Sites

Statistics according to SocialMediaExplorer.com show that:

  • 15% of Americans are signed up for a daily-deal site or service
  • 66% of those users are women
  • 62% of daily-deal users are using them as frequently or more frequently than when they started
  • 53% of users tried a business or service specifically because of the deal offered
  • And 23% stated they continued using the business after the deal was redeemed

So, how can you take advantage of this advertising outlet and obtain repeat customers without experiencing an epic failure?

Here are 5 steps to take to prevent a total business meltdown and increase repeat customers:

1.    Pre-Plan for Before and After the Promotion

Thoroughly think through what you want, and are willing, to offer to build repeat business and how you will attract the right customers. You don’t want to cheapen your services and attract customers who will not return. One way you can avoid this is by offering services in bulk or as a packaged deal. Some spas, salons, or gyms can do this. You also may want to offer up a follow up service with a cost not as steep as the first coupon or a preferred customer service program that takes effect after the second visit.

If you have a service or product that cannot offer such packages like a restaurant, provide a coupon or some other type of incentive that gets them in again but doesn’t take away from your bottom line.

2.    Ensure You Have Financial Resources Available

Deal sites don’t pay out until the promotion is over and some don’t pay in full but in bits and pieces.

Make sure you plan for your out of pocket expenses vs. getting only a proportion of the price for your product.

Plan your budget wisely.  Ensure that the price point fits your business by doing some quick research on similar businesses and markets.

Don’t let lack of information and research create a $20,000 mistake from not setting the right price points or lack of staff for a deal that turned overnight success like these small business deal- site disasters. Deal-sites will haggle with you so don’t be afraid to go after a price point that will benefit you and satisfy the deal-site.

3.    Get Your Customers Info!

The email addresses and customer information received through the deal-sites are their property and are unavailable to you. You want to remember to gather the customer’s information when they come in to redeem their coupon so that you can have future contact on other deals or events that you may offer in order to lure them back.

4.    Plan for Procrastination

People procrastinate. They make a quick decision on line, forget about the coupon, or get busy and realize that the coupon is expiring soon and they need to redeem the voucher. Always keep this in mind and have time set aside for procrastination to be a possibility. Set aside for the last few weeks of your promotions expiration date to have more staff if needed, supplies, and additional resources.

If you have a service such as a gym with a limited number of spaces in your classes, use the expiration date as the last date to sign up so that you don’t have to turn people down because you are unable to accommodate the number of customers. Or, you can simply plan to honor the deal past the due date if necessary and you have the ability.

5.    Research your Deal-Site Source

Tons of deal sites are popping up every day. You want to make sure that the site you choose is a reputable source and won’t be closing down anytime soon creating the inability to pay you. Read their terms of service so you know exactly what you are getting and don’t be afraid to ask questions! They are here to help you!

Deal-Sites such as Groupon or LivingSocial can be a great advertising avenue for your business and don’t have to lead to a complete failure or profit loss. It is your responsibility to make sure this is the best decision as with any decision you make for your company. Put these tips to use when getting up and running on your deal-site campaign!

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{ 6 comments… read them below or add one }

Chikara May 3, 2012 at 5:24 pm

I haven’t been hearing as much hype about Groupon lately. It seems like once SMBs had a bunch of ‘cheapskates’ check out their stores, they don’t want it to happen again! Thanks for the tips.
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Zena Wehbe May 4, 2012 at 11:51 pm

Hi! Such useful advice- thanks! The only problem is, when your whole website is an offer in itself, you can really do group promotions or so. You see, my website is completely free. It’s an on-line scientific based diet centre and everything on it is free, even the diets! I feel that it is great in getting people to immediately sign up, but the procrastination to keep them coming back and logging in to use their diets and portfolios is the real challenge. How can you do an offer on something that is already free!?! That’s where I try to use my Blog as a resource that always offers new information. I wonder if you can give further input on this issue for me?
Thanks Again!
Zena
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Curtez Riggs May 6, 2012 at 12:23 am

Groupon is still standing strong and taking advantage of small business around Baltimore. If not them its one of the other 100 copy cat sites…
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Michael May 8, 2012 at 7:04 am

I’ve heard so many horror stories about Groupon and their knock off copy cat brethren, that I was hoping they had gone out of business. Pretty hard to make any money when the people only go to the business for the coupon item and then never return.

Even though I had heard that as anecdotal items, I had no first hand knowledge of that, but this article sure brings up some very good point to make sure you get hold of first before, you ever sign up as a vendor on a coupon organization, that’s for sure.
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William Amis May 9, 2012 at 12:16 pm

I have never herd of them?

I review hundreds of this sites a week and laugh all the time. Yes, it may be wonderful yet is it needed for my business that has been in operation over 32 years. No, it is not and yet I must read to stay aware of things in our global industry.

To be supportive and fare I will make it a point to review the total real home page and complete due diligence on the company with product. That only seems fair and then maybe return to find something positive and edify is one of my focus actions for all businesses and people.

Thank you for a wonderful share of this great information. I am sure it will be worth it for many of your readers. It has given me something new to investigate. Looking forward in seeing your next amazing article.
William Amis recently posted..Your Crazy, Check YourselfMy Profile

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Peter Fuller MBA May 17, 2012 at 1:16 am

I cannot believe how many businesses forget about getting the customers info.

You run a good deal, get lots of new customers, but when they leave your store you have no way to contact them again.

What a waste.

Peter
Peter Fuller MBA recently posted..What You Are Doing Today Will Affect Your Retirement FreedomMy Profile

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