I’ve got a feeling that social commerce is still in its infancy. The daily deal business has turned out be a tough one for companies like Groupon or LivingSocial.
Both of them are struggling in their own way. LivingSocial laid off 400 employees in December 2012, approximately 10% of their workforce, during the holiday season and posted a net loss of nearly $700,000.
The entry barrier to the daily deal business is pretty low. Many companies try out this industry.
My impression is that the daily-deals space is looking a bit overfished.
This is why I am not surprised to hear about Groupon’s (their non-US business shrank by 26% in Q2, 2013) intention to focus more on promotions that don’t expire and mobile payments.
Why am I talking all about this?
Already in August 2012, when I first wrote about how Groupon can help golf course managers in sales, I had some reservations about the benefits of using Groupon to boost golf club membership sales and other golf course services.
Since then, I have come to realize that consumers, including golfers, have a finite amount of disposable income, and they’re loyal to the deal, not the brand.
Another finding is that using Groupon incurs no upfront costs, but can prove very expensive for vendors.
In the very same sunny August, I was happy to read the guidelines of NGCOA (National Golf Course Owners’ Association).
With a one-year delay, the EGCOA (European Golf Course Owners’ Association) has now published its own version on how to use third-party resellers.
I recommend thinking over especially points 3 (best rate guarantee), 4 (database ownership), and 5. (payment model) recommendations.
Why do I highlight database ownership? Just like in the case of Google or Facebook, the ownership of data makes them so powerful.
The power to know how people live, what and where they buy can help marketers a lot.