What Business is 'Deal a Day' Part of?

By Gary Kim March 04, 2011

Some new mobile-related markets are so new it is hard to describe them. Groupon and LivingSocial might be called "social shopping," "group shopping" "mobile coupon,” "location based services,” "local advertising,” "deal a day,” "mobile offers or mobile commerce." There probably are other ways to describe programs that offer limited-time promotions, typically with a mobile component, at local merchant locations. 

BIA/Kelsey refers to the new market as "deal-a-day offers," and estimates growth from $873 million in 2010 to $3.9 billion in 2015, representing a 35.1 percent compound annual growth rate.

But the firm also says the "deal a day" market could grow to as much as $6.1 billion by 2015 (47.4 percent CAGR), while a very conservative outlook pegs the space at $2.1 billion (19.7 percent CAGR).

Some six percent of U.S. consumers surveyed by Forrester Research say they have used a mobile shopping app in the past three months, according to Peter Sheldon, Forrester Research analyst. Looking more specifically at mobile couponing, about 12 percent of U.S. adults planned to use their mobile phones to find or redeem coupon codes during the 2010 holiday season, says Sheldon. 

Perhaps oddly, only six percent of respondents suggested they wanted to receive location-based retail offers on their mobile phones and only four percent reported they were interested in getting time-sensitive promotions such as daily specials. 

A separate survey by the Yankee Group suggests that the number of respondents who use mobile couponing services today (February 2011) more than doubled, from five percent of the base in 2009 to 11 percent of the base in 2010.

Likewise, a recent survey by Compete.com suggested consumers were most interested in receiving grocery coupons (36 percent), scannable barcodes (29 percent), offers to save and pursue at leisure (26 percent), movie theater offers (26 percent), and ads delivered by text message when near a retailer with a current offer (21 percent).

Among the reasons it sometimes is hard to describe mobile couponing services is that there is some obvious overlap with the broader category of "location based" services, such as those that build on "check in" capabilities to target ads or allow people to find each other. There is more direct overlap in the area of local advertising, especially mobile local advertising. Some will rightly note that "advertising" is conceptually distinct from "promotions" such as coupons. 

But most businesses will pay for either advertising or coupon offers out of a single marketing budget. In that sense, at least, offering discounts, limited-time offers and coupons is a subset of the local advertising market. Of course, to further complicate matters, it also is possible that mobile promotions and coupons could in many cases become part of national campaigns rather than local advertising. 

About the only area of agreement is that such services are bound to grow, whether considered part of the local advertising, display advertising, e-commerce, location-based service, mobile advertising, online advertising or some other logical market. 


Gary Kim is a contributing editor for TechZone360. To read more of Gary’s articles, please visit his columnist page.

Edited by Tammy Wolf

Contributing Editor

SHARE THIS ARTICLE
Related Articles

A WebRTC-like Standard for the Internet of Things? It's Complicated

By: Doug Mohney    1/13/2017

Building the connections for the Internet of Things (IoT) is challenging, since applications, services, and devices of all different shapes, sizes, an…

Read More

Dell Pushes IoT Boundaries with Latitude 7285

By: Steve Anderson    1/12/2017

Dell's new Latitude 7285 features WiTricity systems to work wirelessly, a principle similar to IoT operations.

Read More

Yahoo! Shakeup Drops Mayer, Changes Name

By: Steve Anderson    1/11/2017

Ahead of a sale to Verizon, Yahoo Inc. is poised to change its name, drop Marissa Mayer, and never be the same again.

Read More

How Amazon Reversed Microsoft's Strategy to Help Lenovo Create a Better Home AI

By: Rob Enderle    1/11/2017

At CES this past week, Lenovo made an interesting move by licensing the Alexa platform and building its own version of Amazon Echo called the "Smart A…

Read More

Will Space Exploration Soon Benefit from IoT Tech?

By: Kayla Matthews    1/11/2017

Apollo 11, the first spacecraft to successfully take human beings to the moon, had less computing power than the mobile phone you have in your pocket …

Read More