As we continue to navigate the disruptive technology of Daily Deal marketing. I am beginning to see wiser choices by Merchants to execute with more precision when offering Daily Deals. Used properly this form of marketing can do wonders for your business. Here are 5 tips on how Merchants, in the services business, can wisely use Daily Deals to increase their business and not have to lose their shirt.
1. Design a specific service specifically for your Daily Deal. For example, if you are a restaurant and food cost is an issues with offering deals, than design a fixed menu only for your deal. Let’s begin with a 3 course meal for 2. Each get to pick an appetizer, entre, and dessert, but all the portions will be less than the usual portions you deliver on your regular menu. In this case you still keep some of your costs, and at the same time your new customers get to try your food to see if they would like to come again and pay full price for full servings. Finally, once being a waiter myself, please make sure gratuity it automatically included with the original value of the meal. Your discount to customers should not mean a discount on your waiter’s income.
2. Understanding fixed costs. Recently, I purchased a Groupon to a local gym. First they created a schedule of classes that were not at prime time hours for the gym. Next, the classes were specifically for Groupon purchases, so you don’t combine a class of full paying customers and Grouponers. Finally, they used interns, which they were not paying, to teach the class. This to me was the ideal execution of how daily deals are done. The customer gets to try the gym, interns receive the education they need to train, and the gym reaps any revenue generated from the sale of their Groupon. Well done.
3. Your new employee needs to build their book of business. There are many service oriented business in which it is difficult to build a book of business and can take many years until you are thriving and in a position to turn down business. Some that come to mind are hair stylists, nail technicians, masseuse, and chiropractors. For businesses that are looking to help their new employees boost their book of business, a daily deal might be just what you need. You can offer the daily deal knowing that only these booking will be going to your new employee. Be aware of the time your business is willing to dedicate to this so that you can cap how many deals you are willing to offer.
4. Be Ready. Make sure that you will have an electronic device to input all of your new customers that come in the door. I say electronic because having a clipboard of scribbling emails and names will lead you to lose some of your “Gold Leads”. Explain to your new customer that you need the email they entered with the daily deal site they purchase the deal they are using, or request which email they would like to have you send your next daily deal to. As time goes forward and you build your database, you can deliver your daily deals directly. If you still want looking for more you can always run another deal on one of the larger deal sites.
5. Understand and Cap your deals. One deal that I am always reminded of when talking about daily deals is Salon 505 that sold 5000 half day spas in Austin. Really?The salon would have to work for almost 7 years at a fraction to their real prices. Not to mention, users would have to wait 7 years to get an appointment. So work the numbers, play out best case and worst case scenarios and know how you are going to handle everything in between. There is always another deal site that would love your business.
Just like any other marketing tool you use to increase your customer base, daily deals are just another piece of your overall efforts. You should not think of this as a revenue generator, but also be very clear on the terms of your deal and the ramifications it will have on your business. While many feeling as though daily deal sites will meet their doom, I believe that experience has shown all parties involved how to approach this powerful lead generator responsibly.