Businesses should focus on loyalty & retention, not deal hunters.
How many of us have heard the recent horrors of a daily deal offer gone wrong for a business? The most famous one is the story published by Washington Post a few weeks ago about a Groupon deal where a bakery was hit with 102,000 cupcake orders( Groupon horror: Bakery must make 102,000 cupcakes).
To understand how daily deal sites can help businesses, there is no need to have a degree in business or finance but rather it should be understood that it is a great source for bringing deal-hunters and that businesses must limit the number of the vouchers to be sold. It’s not entirely the daily deal site’s fault for a deal gone wrong because the merchants should realize that this method does not focus on customer loyalty or retention. So if the owners realize these key features of such deals and its consequences, then it becomes a matter of a business decision.
In the long run, the businesses that feature a deal will not most likely gain loyal customers. To have someone loyal, the customer must feel rewarded by a steady and constant good service and occasional saving opportunities, even if it’s a small percentage off.