March 19th 2012 saw the first daily deal event Europe has ever seen, a much-needed event in the fast growing, three-year young industry and in the words of Jonathan Besnainou from Business Insider: “the initiative was considered a success for the whole industry and proved to be very insightful on different matters.” So good in fact that event organiser, Stavros Prodromou, has since set up the Global Daily Deals Association.
The event saw daily deal executives, founders and owners from all over the world come together to discuss the ins and the outs of an industry experiencing exciting changes as well as its current status. With €1.8 billion represented on the stage, 81 Angels and investors backing the panellists from 25 different countries having travelled as far as 11 688 miles to attend the event, panels members and presenters covered every topic in the deals industry. The three Godfathers of the industry kicked of the event, as Groupon, LivingSocial and Kgbdeals talked about the importance of customer loyalty, exceeding their expectations and building relationships with the merchants by playing the role of a consultant. In keeping with the core values, the panellists impaired their thoughts on the flourishing social commerce model, setting the mood for the rest of the day.
Customer engagement and loyalty – the way forward
The question of customer loyalty is all the rage at the moment in the industry and was a popular topic throughout the day and to many it seems like an obvious strategy to keep the business a float. But in an industry constantly changing in strategy, it is equally obvious that companies attitude to customers should change. Engagement and loyalty have become vital to the future of the industry, the event made it clear that the aim of the game had shifted from quantity to quality. Foursquare’s Omid Ashtari talked about the idea of rewards and specials indicating that it was not all about the discounts but giving people a status. People love status but people do not love ‘email abuse’ and all 40-odd panellists and presenters agreed on one thing: clever email personalisation.
It is now evident that targeted and personalised email campaigns will be key to the daily deals next moves. Bronto shared its seven valuable messages for re-engagement and to bring home revenue and Kate Garraway from Goodypass claimed each email they sent out was unique. A presentation from Return Path gave insight on how to get your emails exactly where you want them and when, whilst DiscountVouchers pressed the importance of data: “Just using data effectively allows you to fight daily deal fatigue”.
So, our over all impression? Use the data you collect to personalise email, it’s more time and effort but the results should pull-off, and differentiation – the original deal model led to a watershed in 1000s of similar sites across the world, but now you have to think about what drives customers to your site and not your neighbours. Armed with this you should have happy and loyal customers, and in term, a successful business.
- if you missed the DD Summit Europe 2012 – you have the chance to access all panels, presentations and interviews here -
Hyper-localisation, Mobile and Real Time – the future of the deals business?
The event made it ever more clear that the business model is far from its origins. Nearly every panellist mentioned in some way or another that mobile and hyper-local is the future. From simply indicating your location through Facebook posts, or actively using Foursquare, a lot of us use hyper and geo-localisation more or less consciously and its integration into the deals world is only growing.
In a sense, hyper-localisation strings into personalisation. Foursquare talked about how they use the data they collect from following people’s activities and locations to understand their customers and recommend valuable and relevant opportunities. Could they get any more personal you ask? And it’s working, with 15 million subscribers and spreading fast across Europe, as they recently deployed their first European base employee.
The big question remains, do people really want to be so public with their lives? In this increasingly connected world, privacy is a sensitive subject but LocalResponse’s Nihal Mehta believes it’s not an issue: “I call this generation the digital narcissists” – which suits the industry players to a tee. Where is this all happening? On our smartphones of course. Whilst many of the big players are just getting into it (LivingSocial has 23% of its subscribers interacting with them via mobile), three years down the line eBay remains a bit of a veteran in mobile, with £5 billion worth of good sold through mobile in 2011, they are heading for £8 billion in 2012. According to Mashable’s Lauren Indvik, 9.8% of all online transactions in the U.S are made on mobile. What does this mean for the customer? This evolution is sure to give them more tools and information to play with and increased customer power will certainly offset more changes in the way things are done in the industry.
- if you missed the DD Summit Europe 2012 – you have the chance to access all panels, presentations and interviews here -
The Emergence of European and Eastern Europe as big market players
America may be a big market but the challenges are not comparable to those in the European market, not only because of the number of different countries, languages and legal systems but because the continent is itself divided into blocks, as Michael Brehm from Rebate Networks pointed out, you wouldn’t even deal with France in the same way as Germany.
The market can be roughly separated into Western and Eastern Europe. The latter facing challenges that Tomas Cupr, founder of Slevomat, says they are slowly but surely overcoming, in a region where online transactions were next to unknown. But it is surely not a region to be underestimated as Gruper.pl and the Slevomat Group made a combined turnover of 110 million in 2011 alone – watch this space, as it’s a market with a lot more expanding to do.
It’s clear that Groupon and CityDeals spead all over Europe in a flash. Despite the euro being a uniting force for Europe, it was made clear during the event that cultural differences are still making it a complicated market where expansion is still mainly being tackled through acquisitions, as Fabian Heilemann (DailyDeal.de bought by Groupon) and Joaquin Engel (sold assets of Groupalia to peixeurbano.com.br) can vouch for.
The next move for the daily deals industry
At the end of the day it was very clear that everyone agreed on the next moves for the daily deal industry, but of course some opinions varied. The general contentious was made a on a few points. Better customer service, engaging loyalty and relationships with merchants a like are absolutely key and making it a business of value to them without devaluating the model for the companies. What was the main answer to that? A new and fresh email marketing campaign, as the phrase ‘email personalisation’ ranked up a high word count throughout the day, for both the global industry leaders and the small time players. Mobile is undoubtedly on the cards for everyone, if it is not already done, in this literally growing ‘mobile’ world paired with hyper-localisation and real time.
Ending on a very interesting note put forward by Mikal Belicove from Entrepreneur, who brought up the idea for an industry association to really concretise it – Stavros Prodromou has since launched the Global Daily Deals Association, “this industry is very young and had grown at a phenomenal rate, but a trade association is long over due”, he explained, adding that, “The GDDA will bring together daily deal providers from across the world to collaborate on industry initiative and standardise approaches to this new and developing sales channel […] The association is the first of its kind and aims to provide one voice for the dynamic and currently disparate daily deals industry.”
- if you missed the DD Summit Europe 2012 – you have the chance to access all panels, presentations and interviews here -
