Editorial Policy

New: Merchant-Friendly Daily Deals

Marcia Frellick

September 27, 2011

Within weeks, loyalty program provider Affinity Solutions, in conjunction with Sovereign Bank, will test daily deals similar to those offered by Groupon or Living Social, but with a merchant-centric twist.
Traditionally, consumers sign up for daily deals by opening an account online and they get a daily deal offer via email based on the city they live in.
The new incarnation, called Spot ON Deals, will allow merchants, through Affinity’s analytics, to target particular consumers with offers based on what they know from the data about consumer spending trends.
“Today’s daily deals programs more often than not attract bargain hunters; they don’t encourage repeat business, and they don’t allow merchants to meaningfully track results," said Jonathan Silver, President and CEO of Affinity Solutions in a press release.
Spot ON Deals will enable merchants to track the effectiveness of their offers and use information on how the offers are being used and by whom to send follow-up offers to encourage repeat business.
The program initially will be rolled out only to Sovereign customers. Consumers who choose to receive the service, which starts Oct. 18, will get three Spot ON Deals a week through email, according to Affinity. They will also be promoted through a consumer’s online banking experience.
Consumers can also download an app that will integrate Spot ON Deals with Google search results. After a consumer redeems an offer for a particular deal, marketers can set up a bounce-back email that presents the consumer with a new offer.
Marketers will be able to view redemption and sales metrics, as well as how many times a consumer purchased from the location or store after the initial offer was redeemed. That addresses a complaint by merchants who have offered these deals only to find that customers often use them as a one-time bargain.
Analytics can segment a consumer’s shopping behavior into categories, such as clothing, travel, restaurants and groceries.
Spot ON Deals is one of the latest players in a fast-growing field. Research firm BIA/Kelsey reports the daily deals industry in the U.S. is growing so quickly that it has revised its March 2011 forecast, which measures daily deals, flash sales and instant deals.
The revised report projects that consumer spending on deals will grow from last year’s $873 million to $4.2 billion by 2015 (a 36.7 percent compound annual growth rate). This is up from their March estimate of $3.9 billion for 2015.