Daily Deals Are Good for Business

The daily deals market has been criticized heavily in the past for driving low quality business to merchants. Groupon responded to the unflattering accusations by rewarding shoppers who became repeat buyers and LivingSocial recently announced that they’re introducing a credit card that will do the same. Are daily deal shoppers really only taking advantage of one-time deals and never becoming loyal brand consumers? Not according to new research.

The Foresee data

Foresee, an analytics company that measures customer experience, released the results of a study this week that contradicts previous daily deal findings. The online survey from Foresee, which took place in November and December of 2011 and tracked the habits of 10,000 online shoppers, shows that daily deal buyers are far more likely to turn into repeat customers than to only take advantage of a one-time-only deal voucher. The Foresee study found the following:

· ★ 91% of deal redeemers have had or plan to make a repeat purchases with the company from which they purchased a daily deal voucher.

· ★ 29% of deal buyers are new customers.

· ★12% of shoppers had never heard of the business they purchased the daily deal from.

Only a mere 3% of online shoppers said they would not make another purchase with the merchant company who offered the daily deal.

“No one really knew what to expect when daily deal sites first came on the scene, but our research shows that these sites are no passing fad,” said Larry Freed, president and CEO of ForeSee. “Businesses that use these sites effectively are growing their customer base and customers are getting a deal, which results in a win for everyone. The challenge is for businesses to use this tool in smart ways and to work with daily deal sites who can deliver a good experience to users and merchants alike.”

This is good news! Despite previous findings, it seems that daily deal offers do increase business awareness, purchases, and repeat purchases.