In this webinar, from the Msgme Industry Insights series, we unpack the daily deals business completely and reveal why ongoing, interactive engagement is the key to success.
The UX of Automation by AJ King, Senior UX Researcher, Ocado
Webinar-Daily Deals and Mobile-Engagement Explained
1. Msgme
Industry*
Insights
*
Daily
Deals
And
Mobile
-‐
Engagement
Explained
Kane
Russell,
VP
of
Marke,ng
Waterfall
Mobile
1
2. Waterfall
Mobile
and
the
Msgme
Pla:orm
Waterfall
Mobile Msgme
๏ Founded
August
2005 ๏ Free
trial:
www.msgme.com
๏ Offices
in
SFO
(HQ),
NYC
&
Aus,n ๏ API
suite:
developer.msgme.com
๏ Backed
by
Vista
Equity
Partners
๏ Custom
applica,on
development
๏ Cross-‐channel
mobile
&
social
CRM
via
SMS,
๏ Short
code
provisioning,
cer,fica,on
MMS,
QR
Codes,
IVR,
Facebook
&
TwiXer &
audit
management
2
3. Objec>ves
๏ Daily
deals
-‐
“hot”
or
“not?”
๏ Economics
-‐
how
daily
deals
create
value
๏ Success
factors
-‐
how
daily
deals
can
stay
“hot”
๏ Solu,on
-‐
mobile
marke,ng
CRM
๏ Implementa,on
-‐
mobile
and
daily
deals
๏ Key
takeaways
3
7. Is
Deal
Fa>gue
A
Factor?
Daily
Deals
Consumer
Survey
Data
(n=943)
Subscribed
to
daily
deals 86%
Subscribed
to
Groupon
&
Living
Social 72%
Only
buy
from
Groupon 41%
Subscribed
to
at
least
3
providers 36%
Been
subscribed
more
than
1
year 20%
Now
opening
fewer
or
none
of
offers 74%
Will
buy
fewer
deals
than
have
in
past 68%
Source:
Local
Offer
Network
EsAmates
7
8. Daily
Deals
Industry
Revenue
Projec>ons
US
Group
Buying/Daily
Deals
Market
INDUSTRY
REVENUE
(GROSS)
in
billions
of
dollars
$2.67
$1.12
2010 2011
Source:
Local
Offer
Network
EsAmates
8
9. Daily
Deals
Industry
Offers
Growth
US
Group
Buying/Daily
Deals
Market
TOTAL
OFFERS
PUBLISHED
40,000
39,993
30,000
20,000 22,163
19,676
10,000 14,462
6,895
2010
Q1 2010
Q2 2010
Q3 2010
Q4 2011
Q1
(E)
Source:
Local
Offer
Network
EsAmates
9
10. Economics
of
Daily
Deals
Daily
Deals
Service
Providers
Before
During
Ajer
Deal
Day
Consumers
Merchants
10
11. Before
Deal
Day
๏ Daily
deal
value:
amount
consumer
would
pay
normally
๏ Daily
deal
price:
amount
consumer
pays
for
daily
deal
๏ Daily
deals
sold:
number
of
daily
deals
purchased
by
consumers
๏ Revenue
split:
agreed
upon
provider
and
merchant
revenue
share
๏ Payment
terms:
,me
un,l
provider
pays
merchant
๏ Average
>cket:
the
normal
purchase
amount
at
merchant
establishment
11
12. Deal
Day
๏ Merchant
revenue:
amount
of
revenue
generated
for
merchant
๏ Provider
revenue:
amount
of
revenue
generated
for
provider
๏ Redemp>on
rate:
percent
of
customers
that
purchase
and
use
daily
deal
๏ New
customers
%:
percentage
of
new
customers
for
merchant
from
deal
๏ Credit
card
processing:
charge
by
credit
card
companies
for
transac,ons
๏ COGS:
cost
to
the
merchant
of
good
sold
๏ Other
merchant
costs:
cost
to
the
merchant
of
doing
business
๏ Consumer
spend:
consumers
may
spend
more/less
than
daily
deal
value
12
13. Ajer
Deal
Day
๏ “Yelp”
effect:
percep,on
of
merchant
aler
daily
deal
promo,on
๏ Repeat
customers:
number
of
consumers
who
return
to
merchant
๏ “Deal
hunter”
effect:
number
of
consumers
willing
to
buy
at
full
price
13
14. An
Example
Daily
Deal
Promo>on
According
to
terms
from
Techcrunch
“Stop
The
Hate,”
hop://tcrn.ch/nIW:Q:
14
15. So
How
Can
This
Work
For
A
Merchant?
Unfortunately,
not
as
simple
as
“merchants
should
nego>ate
beoer”:
15
16. Daily
Deals
Industry
Factors
Low
margin
businesses
face
much
greater
risks
running
a
daily
deal:
16
17. Daily
Deals
Execu>on
Factors
Daily
deals
can
be
profitable
if
they
aoract
new
and
repeat
business:
17
18. Purng
It
All
Together
Higher
margin
business
+
nego>ate
terms
+
execute
well:
18
19. Daily
Deals
Success
Factors
๏ For
Merchants
-‐ Nego,ate
beXer
terms
with
deal
providers
-‐ Make
sure
daily
deals
is
right
for
your
business
๏ For
Merchants
&
Providers
-‐ AXract
new
customers
with
daily
deals
-‐ Make
sure
new
customers
return
-‐ Recruit
these
new
customers
as
brand
ambassadors
19
20. Mobile
Marke>ng
CRM
1)
Build
a
mobile
subscriber
database
2)
Mone>ze
database
through
interac>ve
mobile
communica>on
campaigns
IVR
20
21. Time
To
Invest
In
Mobile
Is
Now
Which
describes
your
mobile
strategy?
Source:
Forrester
21
22. Time
To
Invest
In
Mobile
Is
Now
What
kind
of
investment
in
mobile
do
you
foresee
in
2011?
Source:
Forrester
22
23. Time
To
Invest
In
Mobile
Is
Now
What
do
you
feel
are
top
uses
for
mobile?
Source:
Forrester
23
24. Mobile
and
Daily
Deals
๏ ABract
new
customers
with
daily
deals
Vet
daily
deal
sign
ups
against
ac>ve
subscriber
list
No>fy
current
customers
of
alterna>ve
promo>ons
๏ Make
sure
new
customers
return
Capture
mobile
subscribers
upon
deal
sign
up
Capture
mobile
subscribers
upon
purchase
๏ Recruit
these
new
customers
as
brand
ambassadors
Run
“bring
a
friend”
campaigns
for
new
subscribers
Drive
online
brand
equity
via
interac>ve
campaigns
24
25. Case
Study:
Gelato
Spot
Success
to
date:
๏ Had
customers
opt-‐in
for
mobile
subscriber
list
when
they
used
daily
deal
vouchers
๏ 80%
of
these
customers
remained
on
list
aler
three
months
๏ Mobile
coupon
pitches
gemng
highest
redemp,on
rate
for
any
other
medium
Next
steps:
๏ Encourage
new
customers
to
return
with
their
friends
๏ Run
campaigns
geared
toward
brand
value
instead
of
coupon
purchases
Source:
ClickZ
MarkeAng
News
25
26. Key
Takeaways
For
Merchants: For
Daily
Deals
Providers:
๏ Perform
due
diligence
to
make
๏ Not
all
revenue
is
good
revenue
sure
daily
deal
right
for
you
๏ Encourage
merchants
to
think
๏ Drive
new
and
repeat
business beyond
the
campaign
๏ Adopt
a
life,me
value
๏ Differen,ate
brand
with
perspec,ve innova,ve
technology
solu,ons
26
27. Any
Ques>ons?
For
more
informa,on
visit
www.msgme.com
More
industry
informa,on
available
on
our
blog
@
blog.msgme.com
Case
studies
are
available
@
clicky.me/msgmecs
Or
contact
us
directly:
marke,ng@waterfallmobile.com
27