Stop Marketing On Deal Sites Until You Read This Post

By Raubi Perilli |

  | Oct 15, 2017  /  Solutions |

For many businesses, running a deal on sites like Groupon sounds like a smart way to promote services, expand your audience, and bring in new customers and clients. But, there is a price to pay for these benefits.  Running a Groupon like ad is expensive, has limitations, and could even cause your business to LOSE money.   So if you’re currently using a Deal Site to promote your business or thinking about starting a campaign, stop right here. Read this post before you launch your next Groupon or discount deal campaign.

Deal Site Ads Aren’t as Affordable as They Sound

At a first look, posting a deal site ad appears affordable…because it’s free. Businesses don’t pay to post on site like Groupon.   But, that doesn’t necessarily mean it’s a free, cheap, or an affordable promotional strategy.

To run an ad on a Groupon like site: 

  •  A business promotes an offer that cuts the price of their product or service by a set percentage (depending on the deal, this could reduce the company’s potential revenue on a sale between 20-80%).
  • The business then gives half of the remaining revenue to the deal site at the time of purchase (further reducing business revenue).

For example, if a restaurant runs a "half-off" promotion and sells a $50 gift card for $25, they realize $12.50 when the buyer redeems their coupon. The business spends $37.50 to get the customer in the door.  

Marketing On Groupon

This expense can be worth it. Depending on a business’s margins and cost per customer or client acquisition, this could be a good strategy. Also, depending on the percentage of the discount, the deal could leave the business with more revenue per sale. 

But in most cases, the marketing cost is high and only worth it if the business can get the customer acquired through the deal site to become a loyal, repeat, non-deal customer.  

And these sites do not help you with that part.

Deal Sites Do Not Give You Customer Data  

Deal site campaigns don’t give businesses the full benefits of a strategic customer acquisition strategy.  

The site collects data from customers when they purchase an offer -- but they don’t share that information with businesses. Customers enter their email address when they buy, but that contact information is never passed over to the company.  

So, a company could pay $37.50 to bring a new customer into their restaurant and not even get the contact information that would allow them to reconnect with the customer. It’s a $37.50 cost for a new customer with no guarantee that you will ever reach them again.    

Collecting customer data (such as email addresses and phone numbers) is vital in a customer acquisition program because that’s what allows you to retarget and remarket to those new customers.  

And, you must retarget and remarket to deal site customers.  

With such a high customer acquisition cost, a business can only make money with a deal if customers and clients return. If customers just visit once to use their deal, most companies lose money.  

The goal of running a Deal Site ad isn't to get customers through the door one time. It’s to get customers through the door multiple times.  

So if you are running or planning on running a deal site campaign, you must pair it with other marketing strategies.

How to Get the Most Out of a Deal Site Campaign

If you want to get the most out of a Groupon like promotion and stop your business from losing money on this marketing strategy, you must implement additional strategies.

Step #1) Plan a data collection strategy.

To get the most out of a deal site campaign, you must have a lead generation system that collects contact information from customers and clients. When customers or clients engage with your business after purchasing their deal, get them to share their contact information with you by using the following strategies.  

Make it easy for customers to give you their information. A client isn’t going to go the extra mile to get their contact details to you. You have to make it easy for them. Use touch-screen kiosks and provide forms and sign-up sheets in your location. Set up text marketing systems so customers can text a number to join a list. Add opt-in forms and lead pages on your website, and ask customers for their contact information when they make a purchase or schedule a service.  

Marketing for groupon

Present an opportunity for getting another coupon. Encourage customers and clients to give their information in exchange for another coupon or discount. You already know your customers are interested in coupons so give them additional opportunities to save.  

Run a contest. Collect data by promoting a contest or giveaway that requires customer contact information to win. Offer high-value items related to your business to encourage targeted audiences to opt-in. If you offer things that are not related to your business, you may end up collecting information from people who aren’t interested in your offerings and therefore less likely to convert into paying customers.  

Create a VIP or loyalty program. Make customers and clients feel special while giving them an incentive to share their information. Set up a VIP club or loyalty program that offers exclusive content, discounts, or bonuses to members. This strategy collects data and also aids with remarketing as you are already encouraging customers to come back again.  

Add tracking codes that gather data from your website visitors. There is a strategy for collecting information from a customer or client even if they don’t directly provide it. You can add a Facebook or Google tracking code to your website that allows you to collect data from your website visitors. It’s likely that if someone bought a deal offer from you, they would visit your website to get more details. By using a tracking code, you can capture information about this audience so you can later retarget them.  

Once you collect contact information from your deal-seeking customers, it’s time to put it to use.

Step #2) Plan a retargeting and remarketing strategy.

Set up systems to retarget and remarket the people who bought the deal, so they come back to your business again and again. You can successfully do that by implementing the following.  

Segment before you target. Data is valuable, but segmented data is even more valuable. Segmented data is user information categorized by user characteristics and habits. For example, it may include different lists for customers who sign up for a particular promotion or viewed a specific page on your website. Segmenting your data is crucial because it allows you to send targeted information only to audiences interested in your messages.    

Create email marketing campaigns. When you have a segmented list of email address, you can begin creating email marketing campaigns designed to target your audience based on their interests. You can launch regular email newsletters to promote your business, send special email promotions, highlight deals and events, keeping your business top of mind.  

Create text marketing campaigns. Like email, you can use text marketing to keep your brand in front of customers. You can create time-sensitive offers, promote specials, and encourage customers to return using this powerful contact method. Many businesses overlook text marketing, but it’s an incredibly useful tool for connecting with audiences on the device they use most.  


Find out why restaurants miss out by not using text marketing.

Read Our New Guide to Text Marketing  


Use your customer data to advertise on Facebook. Because you installed retargeting codes on your website, you can use the data you collected to promote to an engaged audience on Facebook. Through Facebook advertising, you can create a custom audience that only includes people who have visited your website or performed a defined action on your site. You can then create ads that only show to that audience.  

Use your customer data to advertise on Google. You can also use data collected from the backend of your website to reconnect with users on sites across the internet. Through Google display ads, you can set up ad campaigns that target only the people who visited your website. This strategy shows ads to audiences on any website featuring Google display ads. So an ad for your business could show up while a prospect is browsing any number of sites.  

With these strategies, you increase the likelihood that the person who bought your Groupon deal will come back to your business. That is the result you need to focus on from the start of launching a Groupon.  

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Never launch a deal campaign without plans for collecting data from those customers and then retargeting them to get them to come back to your business. Otherwise, you could be wasting marketing dollars, letting opportunities slip through your fingers, and losing money.

Are You Getting the Most Out of Your Online Marketing Strategies?

Failing to set up a strategic deal campaign is just one example of how businesses create digital marketing strategies with good intentions -- but fail to implement systems to get the most for their efforts.  

Many small businesses think they are saving money by launching campaigns like this on their own. But, they could be losing money by making costly errors like this.

Don’t let that happen to your business. If you’d like to review your marketing strategies to get an expert opinion on where you are succeeding, failing, and missing opportunities -- let’s talk. MyArea Network specializes in working with locally-owned businesses, and we’d love to see how we can help you stretch your marketing dollars to connect with more customers and clients.  

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