Last Updated Aug 24, 2010 9:49 AM EDT
In today's economy, who doesn't want a great deal?
'Discount retail' ranks No. 4 on Entrepreneur's annual "[10 and 1/2 ] Trends to Watch" list for 2010. It's no surprise, then, that the online daily deal market – which has grown into a billion-dollar industry in a little more than a year – has become a popular tool for consumers looking to get more bang for their buck.
“In general, a consumer can save between 50-90% [by using online deal websites]; so, we are talking big bucks,” says Jim Moran, co-founder of Yipit – an aggregator website for daily deals. “We’ve seen deals offered across virtually all consumer verticals from restaurants, spas and gyms – to basic services like A/C inspection, car washes, and dentist appointments.”
Local businesses – which offer the discounts through big sites like Groupon and LivingSocial – take advantage by marking down their services when they have any unused inventory (e.g. open tables at lunch, free salon appointments in the middle of the day, etc.)
The catch? There is none, really. But unlike old-fashioned coupons, these deals often require an upfront payment; you collect the goods or services at a later time.
“Running a daily deal promotion is a form of advertising for local businesses... but they only pay once a deal is sold,” Moran says.
Moran’s partner, Vin Vacanti, suggests Facebook users ‘Like’ their favorite brands or products – or follow them on Twitter – for special exclusive deals available only on company-sponsored pages. (A recent study by Rosetta found that 59% of the top 100 major U.S. retailers are taking advantage of social networking sites.) Nabisco, for example, recently offered its Facebook followers a buy-one-get-one-free coupon for a package of cookies.
Signing up for various site deals could be a bit overwhelming for your inbox; however, the amount you could end up saving – even for a few great deals every now and then – might be worth the extra hassle. One possible solution: Set up a separate e-mail account just for online deals. That way, you can check it sparingly.
Check out these 12 most-popular discount sites:
- Groupon: The Web's largest daily deal site, offers deals in everything. Average discount: 50%.
- LivingSocial: Second-largest daily deal site. After purchasing a deal, you'll get it FREE if you share it with three friends and they buy the same deal.
- BuyWithMe: Provides multiple deals per day, per city; smaller audience, average deal is 50-60%.
- Tippr: Deals focus on dining and services; discounts increase as more users purchase the deal.
- Gilt City: Local daily deal offering. Offers a variety of high end restaurants and services at serious discounts. Currently available in New York and Boston – but expanding quickly.
- BlackboardEats: Offered in San Francisco, New York, and Los Angeles. Restaurant-focused. Deals are free for consumers; provides users with redemption codes good for a month.
- Angie’s List: Home services deals provided by the successful review site for home contractors. Available in nearly 20 cities, with offers ranging from A/C inspection to framing and maid services.
- Social Buy: Available in more than 10 cities. General deals plus social events and celebrity recommendations/endorsements.
- Scoutmob: iPhone-focused daily deal site with emphasis on restaurants and personal services. All deals are free for consumers. Also provides insights on local culture and activities.
- DealMap: Delivers deals on a map, list, daily e-mail or Twitter feed – all customized to the types of deals each user wants to get.
- DealQue: Online social shopping community and bargain hunting site. The deals are rated by its users and community.
- Yipit: Puts together daily deal emails drawing deals from Groupon, LivingSocial, etc. The service offers customized emails based on your interests.
- 8coupons: See the deals closest to your location using an interactive map.
Do you have a favorite deal site that’s not mentioned above? Sign in and share it with us in the comment box below.
More on MoneyWatch: