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

Is the Apple Bubble Finally Bursting?

By: Andrew Bindelglass    4/28/2016

Over the past 13 years, Apple has been one of the most successful companies in the world of tech, posting sales growths in 51 straight quarters. That …

Read More

Shared-Space Providers (Airbnb) Poised to Beat Ride-Sharers (Uber)

By: Steve Anderson    4/28/2016

Travel may be starting to make a bit of a comeback, as a new report suggests that shared-space providers like Airbnb and WeWork are on the rise.

Read More

Facebook Wants More Sharing, Building New Camera App to Drive It

By: Steve Anderson    4/28/2016

One of the great downsides to having a lot of content in any one place is that, after a while, it starts looking downright pointless to add more.

Read More

Comcast Targets DreamWorks Animation for Acquisition in Multi-Billion Dollar Deal

By: Steve Anderson    4/27/2016

A new and unsettling movement is taking place in the content markets, and it's focused around one of America's most hated companies: Comcast.

Read More

How Much Is Internet Access Worth to You?

By: Maurice Nagle    4/26/2016

In sports there are many tales of epic heroism, from Madison Square Garden erupting when Willis Reed walked out of the tunnel in game 7 of the 1970 NB…

Read More