entertainment venue, or cupcake shop in town—DealPop is able to approach local merchants that it knows consumers are already interested in, and follow search trends to encourage consumers to check out similar markets.
“We really want to play up the local part of each neighborhood, but as a Seattleite, I know I spend a lot of time exploring other neighborhoods,” Nakao says. “We want to combine the element of discovery and local in addition to offering some really good deals.”
It is also a top priority for DealPop to establish longstanding relationships with vendors and consumers. In order to do this they have local representatives sharing face-time with merchants to establish a relationship and help them prepare for deals. DealPop plans to keep consumers engaged by sending our reminder e-mails before a purchased deal expires, and allowing them to earn points toward other deals by sharing their interactions socially via Twitter, Facebook, and e-mail, a feature that is entirely optional, according to Nakao. He calls this creating a “value proposition for both seller and buyer.”
“One of the ways we’re differentiating ourselves is we’re looking at this as a service, versus a transaction,” Nakao says. This, he says, is what distinguishes DealPop from larger brands like Groupon and LivingSocial. And though the site is banking on its truly hyperlocal feel, according to Nakao, WhitePages has the resources to carry DealPop to other cities besides Seattle—and it plans to. WhitePages estimates it will roll out DealPop sites to six more U.S. markets (including clearly defined geographies within major metro areas, such as West Los Angeles, Manhattan, Brooklyn, and the City of Boston) before the end of the year.
Of course while many in the social media world, like Fatzinger, have heard “horror stories” about larger deal-a-day sites ripping off the small businessperson, many local merchants have had good experiences.
Karen Jahn, who owns a Seattle salon called The Wax Bar, participated in a LivingSocial campaign in May, around the time that she opened her second location in West Seattle. And although she said it took months to get the campaign going, she saw a huge surge in return customers as a result.
“As a business you do take a big cut. We sold a gift certificate at $100 for $50, and then you give them a cut for it. So it’s like, you’re paying $30 for something that costs $100,” Jahn says. But of the 600 certificates they sold on the site that day, she says about half so far have resulted in return clientele. “”It really got the word out there.”
And that’s why smaller players like Tippr and DealPop say they are committed to making sure their deals are valuable to both consumer and merchant.
“Part of it is being a true partner to the merchant and trying to provide software to the merchant to run their business—to attract and obtain customers,” Tobias says. “Groupon is not in the software business, they’re in the make-as-much-money-as-they-can business… It’s a very different mentality…Groupon is trying to give brand loyalty to Groupon.”
Both Tobias and Nakao say their group buying sites have a different goal: to give brand loyalty to merchants.
