Know thy customer
A recent study by Rice University suggested that 40% of merchants surveyed who had run a daily deal would not run one again. The biggest complaints here seem to be centered around lost money (bad deal management) and lack of new customers. At the same time, a study by ForSee Results found that over 62% of consumers who redeemed deals were new, infrequent or former customers of that service provider.
Clearly the new customers are there, yet merchants often forget, neglect or just flat out ignore one of the basic tenants of small business, get to know your customer. In fact, the daily deal providers do phenomenal job of getting customers in the door, now merchants need to do a better job of getting them to come back, again and again. Customer retention is the tool that turns these deals into home runs. Get their names and email addresses (you would have them already if you used a scheduling service), ask them to follow you on Facebook and Twitter, use points or other loyalty programs for frequent diners and repeat customers, give them another coupon (smaller) for a return visit or simply thank them personally for the business.
While intense competition in the daily deal arena is already making deal opportunities more small-business friendly, merchants must understand the need to educate themselves on the ins-and-outs of daily deal services, conduct that education thoroughly, and manage every facet of the deal fulfillment to gain the maximum long term value for their businesses. With the kinks ironed out, daily deal sites stand to boost the local business sector to extents we haven’t seen in decades.
About the author: David Galvan is the President of Schedulicity, an online appointment scheduling program used by small businesses across dozens of industries.