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Have you gotten a great deal from CityDeal?

Promotion sites like CityDeal could present a valuable marketing opportunity for your business. They have the customers and you have the product or service. It could form an important part of your digital marketing strategy. What could possibly go wrong?

I want to take a look at the benefits for businesses (and consumers), but also look at possible drawbacks and the potential to damage your reputation.

What is it?

CityDeal is a voucher deals website owned by Groupon, a company that has grown massively in the last year. Groupon is so big globally that Google tried to buy them last Dec for a reported $6 billion. But Groupon weren’t for selling.

And there are many other voucher code and deal sites with various offerings operating in the Irish market:

• Boardsdeals.ie
• LivingSocial.com
• One4all.ie
• Fatcheese.ie
• Pigsback.ie
• BeThrifty.ie
• Easydeals.ie

How does CityDeal work?

The site offers a deal each day, dependent on whether enough customers sign up for it. This allows a business sell a minimum number at a particular price.
Customers sign up for a daily newsletter which offers them the deal of the day. This can get your business in front of a lot of eyeballs in a way your business might not be able to achieve otherwise.
CityDeal build on their existing database by a ‘recommend a friend’ reward system. They make this easy by placing social media sharing links on every deal.

Benefits

The benefits for businesses are obvious – you can reach many more customers and sell more. The site has an opted in email database that is every email marketers dream. Even if those customers are not in the market for your product now, you have got your brand in front of them for a few seconds. It can be a useful marketing exercise.
For consumers, there are definitely deals to be done. These kinds of sites have responded to the increasingly price-sensitive nature of consumers. And for customers who are flexible on the ‘when and where’, the goods are there for them.

Business drawbacks

•   The commission taken by CityDeal and similar sites has to be carefully looked at and can be up to 50%. In combination with the discounts, which for CityDeal may be up to 60%, the margin may not be worth it.
•   You may get more business than you can handle. If you don’t deliver the service, it can backfire.
•   Your brand may be cheapened. When customers realise what you can sell it for on a deal, they may not value your brand as highly.
•   Existing customers may think they have been paying too much and feel aggrieved.
•   The business doesn’t get paid until the customer redeems the coupon. If the customer never uses it then CityDeal pockets the money.
•   A weakness of the site is the lack of targeting. The deals emailed are ‘local’, but perhaps not local enough. If you live on Dublin’s southside, then a hairdresser deal in Malahide is not relevant to you.

Business beware

But I think a bigger problem for businesses is when they try to sell products and services that they can’t sell elsewhere. Businesses need to be careful that they are not seen to be trying to hoodwink people. A ‘deal’ is not a good deal if the availability isn’t there when the customer goes to book. With the rise of social media, consumers have a loud voice and reputation management for businesses is a growing concern.
Every business wants to get new customers, but customer retention is so important. If you annoy this group, who like your product and want more, then the whole thing is counter-productive.

Example 1:

Selling a luxury night away with a voucher value of €360, but when you go to book there is no availability except for a Mon, Tue, Weds and a couple of Thurs. Now, a mid-week hotel offering in Ireland is not the same as a weekend offering.

CityDeal ‘Voucher Value’ advertised               : €360
CityDeal cost for 1 night B&B for 2 people     : €150
Website cost of 1 night B&B for 2 people
+ DINNER FOR TWO – Midweek                         : €220

Do the maths.

The hotel referred me back to CityDeal and made no attempt to ‘deal’ with the issue. CityDeal, to their credit, addressed the problem quickly and agreed a refund without quibbling. It has since been credited back to my credit card.
But I won’t go back to Castle Leslie again.

Example 2:

Selling a Dinner deal, but when you go to book it’s only available until 6.30. In my gastronomic opinion, this is not ‘dinner’, it’s an ‘early bird’.
Does Conrad Gallagher want his customers to go back to Salon des Saveurs?
And I’m not the only one who sees a problem. It was noted last Sat in The Irish Times Magazine ‘What’s not hot’ section.

Experiences like these annoy consumers and so they hit the unsubscribe button.  Will CityDeal ultimately lose subscribers? It’s going to be a balancing act for them.

Groupon’s rise to online greatness

“Groupon represents what the dot-com boom was supposed to be all about: huge sales, easy profits and solid connection between bricks-and-mortar retailers and online consumers.”

To find out more about  ‘the fastest growing company ever’, have a read of this excellent Forbes article on Groupon.

What do you think?

You may already have your brand name and be quite happy, thank you very much.

But, if you’re just starting out, or you’re thinking of rebranding, then one of the factors that might influence your choice could be how you will be differentiated by Google on a search results page.

For example if you’ve got an urge to shop and try to find ‘Next‘ on Google, you’ll find them, but in the mix will be movies called ‘Next’, IT comanies with ‘Next’ software etc. And while DIY store ‘Woodies‘ dominate page 1 of the Google SERPs (Search Engine Results Page) for their brand term, Google will also tell you that a ‘woodie‘ is a car body style, which isn’t so relevant (though a different meaning might be more familiar to us here in Ireland!).

But if you choose a unique name, you have your choice of domain name and you will dominate the SERPs for that brand name. Take a look at Owjo. The name falls into the neologism category of brand names – makey-uppy names. It may not be as easy to remember as Apple or Orange or Amazon, but it is short and sweet.

Owjo have every result on page 1 of Google, and page 2…

You may not have heard of these guys yet, but I expect you will do soon. They’re claiming to ‘revolutionise’ commerce and it’s no idle boast. Their product is a slickly designed store that you can drop in anywhere you have an online presence eg. your facebook page, blog, website, and you can take payments without having to have a merchant id or Paypal account.

The only downside is that it’s a Flash application so won’t work on iPhones or iPads (Apple’s not biting on that!)

Their website states:

OWJO is a portable online store that can be set up almost anywhere online.  You can add your OWJO to any part of your website, have another website or blog host your OWJO for you, add your OWJO to your Facebook fan page or someone else’s fan page or to your favorite social networking site…add your OWJO anywhere and everywhere.

What’s the best brand name you’ve seen recently?

Does your company have an online policy? Can your employees post at will?

If you don’t have an online policy, it’s probably time to get one! Back in the day of offline media dominance, only journalists had the ability to publish content and reach out to an audience. Journalists working in these channels are subject to editors and have editorial guidelines and training to help them decide what to publish and what is not permissible. For some, there are hefty legal departments available to advise them.

Online Reputation

Contrast this with the individual’s guide to publishing online. ‘Common sense’ is the best ‘advice’ available. This leads us to Eric Schmidt’s (Google CEO) interview in the Telegraph today where he suggested that young people might need to change their names to escape an ‘indiscreet’ online youth. Such a suggestion creates a bit of a stir, but essentially he’s got a point – people can now have enormous amounts of information about them freely available online. While some blogs and forums may be moderated, there tends to be little editing of online content. And crucially, once it’s posted, you can’t take it back. It could be stuck in Google’s index and served up years later – with your name on it or your picture even. For young people in particular, who may have few concerns now about their reputation and their privacy settings on FaceBook now, may find what the internet says‘ about them in years to come, does not tally with the sort of person they want to be perceived as when they go for a job!

So the concept that people need to grasp is that:

• what you put online, may stay online
• the laws of libel apply to the internet
• you can’t hide behind avatars
• you have a reputation and it’s online

Brand Management

Companies also have a reputation to protect and there is a need to have an online policy for employees to ensure that the reputation is not compromised, either directly or by association. On the flip side, a company now needs to monitor what’s being said about it and there are tools available to do this. Google Alerts for example can show all mentions of the brand or company online. Of course, then you may need to address any issues that arise.

But for employees, emphasise that they could be perceived as representing the company when they post online and to bear in mind the following points:

• any form of  communication could be taken as the company view
• consider the context of what’s written, could it be misconstrued out of context
• think about the wording carefully, a flippant or sarcastic tone can come across badly 
• take time, and advice, before responding to negative or critical comments
• ensure that facts are correct before stating
• never insult, a negative attitude reflects poorly on the publisher or poster, rather than recipient
• don’t argue online, take it offline with a phone call perhaps, to establish opinion and maybe reach common ground

Web 2.0 may be about  ‘joining the conversation’,  but as in any dialogue, the articulate and considered contribution is the more valuable (and enjoyable)!