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

Apple's iPhone 7 Set to Show in August, Sell in September

By: Steve Anderson    5/22/2015

It's hard to believe, but we've already been with the iPhone 6 and the iPhone 6 Plus for almost a year; since September, these devices have been at th…

Read More

Twitter, Google Kick Off Search Integration

By: Tara Seals    5/22/2015

Twitter and Google have kicked off a user engagement campaign that brings Tweets to Google Search.

Read More

Interested in a Chromebook? 7.3 Million Will Be This Year

By: Steve Anderson    5/22/2015

Admittedly, Chromebooks probably don't top a lot of wish lists, but a new report from Gartner suggests that this breed of inexpensive cloud-driven lap…

Read More

LogJam Computer Bug Creates Another Ruckus

By: Peter Bernstein    5/21/2015

When it comes to malware and other types of computer bugs it seems like we are falling into a problematic pattern: it consists of researchers or "ethi…

Read More

Network Shifts to Support Video Distribution

By: Tara Seals    5/21/2015

Network strategies are underpinned by many aspects. It starts with consumer adoption of online and mobile video in droves. It continues with local cac…

Read More