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Running a Daily Deal Site – Simple Calculus


There are many factors that help make a daily deal site successful, but boiling it all down, it comes down to the following simple calculus: Reach X Deal Quality = Cash. There are a lot of different ingredients that go into both Reach and Deal Quality, as outlined below.

Reach: Yep, you guessed it… There’s a correlation between Reach and Cash, but how do you expand your reach, and do so in the most economical way?

• Remnant ads are low-cost, work best when targeted to specific audiences that relate to each day’s deal event, and can provide one of the best returns on investment. Remnant adswon’t consumer much of your time and they allow you to focus on sourcing quality deals.

• Street teamsare harder to organize, and must be fun; but when done right, they can quickly help increase brand awareness, and more importantly, add new member emails.

• Contests are cheesy, but they work damn well. You can join the crowd and offer the proverbial freeiPad, yet high-value prizes aren’t required. Even $10 or $20 prizes can move the needle, and can be done best through Facebook fan pages such as this:

• Referral credits (a.k.a. “refer a friend”) work well, but can be one of the most expensive forms of member acquisition.

• Strong brand name is important. A location-agnostic brand name works best. “Daily Deals NAME OF CITY” may work well for SEO, but it is too difficult to discuss at cocktail parties, and it prevents scalable growth to other markets. ‘Not rocket science here… To the extent that social commerce is social, just make sure you choose a brand name that is easy to talk about.

• Deal quality is the best and most cost effective way to expand your reach. Simply put, when you offer a good, compelling deal, your members will share it with their friends, which costs you nothing!

Deal Quality: Consistent (not occasional) deal quality is the #1 key to a successful deal site. Offer a good deal and customers will go to the bottom of a river to find you. Never forget that the deals you negotiate with your merchants are rewards for your members. Legacy media companies dipping their toes into the deal space have the hardest time grasping this concept because their allegiances have always been to their advertising merchants, and therefore fall into the trap of offering less compelling deals that simply don’t resonate well with their members. (Here are a couple of favorites: Cemetery Headstones and Colon Cleansings.) Instead, much like Reach from above, there are many ingredients that go into Deal Quality, including the following:

• Choice is what your members want. Avoid restrictions as much as possible such as specific menu items, limited days of the week to redeem, short redemption periods, etc.

• Create an experience for your members when possible. Deals that offer a unique experience can create valuable differentiation amongst the increasingly crowded deal space, and your members will talk about it, share it, etc.

• Understand market demand.Don’t combine offerings just for the sake of doing so. Yes, combine a soda and a hotdog with your baseball game deal (Example: Pawtucket Red Sox), but avoid the Venn diagram pitfall below, illustrating how two loosely-related, yet popular products have been combined into one offer, thereby diminishing the aggregate demand for both products.

diminished demand

In summary, and like anything else, running a successful deal site is not as easy as it looks. There’s already a graveyard of established media companies with built-in reach, established brand names, and experienced sales teams who have burnt through millions without any measurable results. Despite that, this simple approach can be used to help guide your team’s success and to avoid the many pitfalls in the deal space.

Pat Lazure is the Co-founder of Deal Garden. Prior to founding Deal Garden, Mr. Lazure was President – Interactive Media at a Midwestern publishing company, focusing on digital and mobile initiatives, including the launch of six other daily deal properties.



Pat Lazure

DDM Reports
The 2014 Edition of the DDM Daily Deal Publisher Directory is the most comprehensive contact list for daily deal sites, flash retailers, aggregators and individuals operating in the daily deal industry. Each record includes the following: - Company Name - Website - Contact Name - Contact Title - Email - Phone - Address (not all records contain a full mailing address)
The 2013 Media List is a comprehensive database of all major media, bloggers and product/app review websites. If you're looking for PR distribution, this is a great list to begin with. Each record includes: - Contact Name - Publication Name - Website URL - Address - Email - Description
2.7M Consumer Subscribers. This data has been aggregated from a number of websites, which include daily deal sites that have gone out of business. Data includes: - Full Name - Address - Phone Number - Email - Signup Website - IP Address - Date of Signup Data will be delivered via a dropbox link in CSV format.