The world of daily deals and online coupons is changing so fast and the distribution model is changing so fast that it is hard to keep up with. Our biggest concern is that there are just no barriers to entry other than money. Companies like Groupon, Coupons.com, and the dozens of other daily deals online can have any business in the world be a partner or a competitor overnight. The only good news is that some larger companies have already scaled back or jettisoned their efforts in this arena. Just to show you how low the barriers to entry are now, there is the emergence of a new competitor (and even a partner) in town: Bloggers!
Bloggers will be able to plug-in a coupon widget from Savings.com if they publish their blogs through WordPress. If other publishing systems do not have a plugin, expect them to almost immediately.
The deals and coupons from Saving.com will be from its database of over 20,000 deals and coupons from over 9,000 merchants. Some of the merchants were listed as Lands’ End, Old Navy, Target, and Sears. If you go to the Savings.com site, The Home Depot, Bloomingdale’s, The Limited, Crocs, 1-800-Flowers, J.C. Penney, Gap, and others are listed as partners.
Savings.com noted that it has some 400,000+ deals aggregated from online and national retailers, local businesses and daily deal sites; and it further noted that over 5 million per month use the site to find the best deals.
Our take has never been that Groupon is a dead company. It has a great name in this field and a large following. The problem has been in its past revenue recognition model, the reports of it burning through endless millions to grow, and that the private market chatter on its valuation was just way too high. We could easily say the same about Living Social, Coupons.com, Deal Find, and all of the larger sites out there doing daily deals.
Who knows when coupons were invented… Social media existed before Groupon came to life. Social media existed before almost all of these new daily deals and couponing sites come to be. That being said, the intellectual property barriers that exist elsewhere do not generally apply as much. That in turn means that success depends upon those companies whose management teams have the most contacts and which have the most resources to grow.
Daily deals and online coupons are now coming to blogs. Who would have thought that the newspaper companies allowed another business to get around them with no effort. There is probably only so much room for so many players. Ultimately, valuations have to be reflective of how much money could be made off a business and how much the underlying products cost themselves.
JON C. OGG