With Google nipping at the heels of Groupon, a socially-aware "deal of the day" website that provides its users with 1 amazing deal in their city everyday, and with Amazon having just invested in Groupon's top competitor LivingSocial, it would seem that location-based deals are the next big thing when it comes to online retail opportunities. You might be interested in taking advantage of the deals either website is offering, but more importantly if you're a small business owner this is an excellent opportunity to gain new customers.
How does it work?
The premise is relatively simple. Businesses love new customers, and customers love great deals. What services like Groupon and LivingSocial do is provide a certain volume of new customers to a business in order to inspire them to offer an incredible deal to be featured on the service.
More importantly, the featured deals are targeted to only customers in a business's city, heavily increasing the chance that someone who views the daily deals will stop by if they're interested. Best yet, these services generate coupons that the user can either print or simply access it on their mobile device at the location in order to get the deal.
Social sprinkled on top
Now that you have the basics, you might be wondering why these services have become so popular as of late. After all, the rumored purchase price Google has been throwing around for its field leader Groupon is in the multiple billions. The key is, not only do these services give their users daily doorbuster deals (both in their email and on social networks), they also incentivize sharing the deal with their friends through those same avenues. By inviting people to join you on the service you get money you can put towards deals (though it's not required), and you can also plan events around deals for you and your friends.
Why it matters
When you evaluate the huge increase of consumers turning to the internet for shopping, some of which I highlighted in my blog post on Monday, and then also consider the fact that we're being smarter about finding deals and researching products before we buy, it's easy to understand why this is the perfect time for sites like Groupon to garner attention. Especially in the United States where the economy is still struggling, everyone is trying to stretch the most out of their dollar - particularly in this holiday buying season.
If you're a small business looking for a great avenue to attract customers to your location and are considering using a service like Groupon, take a look at this great article on how to be successful with your deal. Beware however, it's important to have a social brand established to some degree to truly tap into its viral nature!