To paraphrase Dorothy in the "Wizard of Oz," "Trends come and go so quickly here."
And the latest flash trend is -- envelope please -- online group buying!
Groupon started the movement by teaching coupon-loving consumers the joys of daily online deals. The big daddy of the group-buying sites had the field pretty much to itself for several years. It now serves more than 140 markets around the world
Then yesterday, second-place competitor LivingSocial sounded the battle call with the announcement it was adding 25 new markets to its roster. The expansion nearly doubled LivingSocial's service; for a total of 52 markets in the U.S., UK and Canada.
The model is simple: The group-buying sites find local businesses willing to provide large discounts in return for spreading their names to new customers. Consumers log on daily, check out their hometown's deals and either sign up or ignore the deal.
Business models var: Some require an established number of buyers before the deal is available; while others reward members who lure in other shoppers.
Businesses like the group-buying process because they get a short-term boost that can to lead to new, long-term customers. The group-buying sites typically get a cut of the promotions.
Here's a look at the top nine sites and how they operate.
Founded in Chicago in November 2008, Groupon offers a different daily discount for every city. Members receive the coupons by email and, if a pre-set quota of takers isn't reached, the deal is off. No harm, no foul -- except everyone involved is a bit sad.
Groupon wisely builds in a few incentives to spur interest. Users are encouraged to spread the word via the usual social networks. If a friend buys into a coupon within 72 hours, the one who sent the link gets $10 worth of Groupon credits in their account. If a referred friend subscribes to Groupon within 72 hours, the person who sent the referral gets $10 worth of Groupon credits when their friend makes their first Groupon deal.
Tuesday's Denver deal offered $7 for 12 issues of the popular 5280 magazine (Denver is 5280 feet above sea level, thus the name of the magazine.) That's a 50-percent discount off the usual $14 subscription price. 3,331 people had purchased the deal when I logged in and the tipping point of 100 purchases was reached at 5:55 a.m.
2. Living Social
As mentioned above, LivingSocial is closing in on Groupon. Their model is somewhat different as they don't require a minimum number of orders before users can take advantage of daily deals. (Take that, Groupon!)
Discounts can't be used, however, until the deal's run-time has expired (shown in a clock on the home page).
Daily deals are available for exactly 24 hours each weekday. Like Groupon, LivingSocial uses incentives to encourage deal sharing. If a user shares a link via Facebook, Twitter or email and three people join via the link, the original person gets their deal for free.
Tuesday's New York deal was $50 worth of food and drink for $25 at Zenkichi, a Tokyo-style Japanese brasserie in Brooklyn. There's a limit of one coupon per table, which means you've got to eat a heck of a lot of sushi to get your money's worth (or maybe I just don't know the price of Japanese food in New York).
Tippr (apparently not named for Tipper Gore) claims to offer deals in 25 major cities, although I had trouble accessing more than nine cities. Unlike Groupon and LivingSocial, Tippr gives users a choice of three deals on its home page, with at least one new deal each day.
Incentive discounts get larger as more people sign up for the deal, though there's a limit to how much the discount increases.
Two deals were offered the day I checked the San Francisco site. The first offered 50-percent off a pair of fairly ugly rings at a jewelry website that will go unnamed. The second offered $95 worth of tanning for $40, something that might come in handy during a San Francisco summer. (As Mark Twain once famously didn't say, "The coldest winter I ever spent was a summer in San Francisco.")
8coupons culls 79 group-buying daily deals from sites across the country, which can total close to 400 promotions on a given day. While this is the ugliest daily deal site I've seen, it does offer a wide selection of savings and is easy to search.
In just one search of my Colorado home town I found 30 active restaurant deals, not all for chain restaurants. One even offered a free second margarita at my favorite authentic Mexican restaurant.
Many coupons are aggregated from direct-mail companies and coupon sites.
This site is basically the same as Groupon. They offer a new daily deal, available for an set time -- usually one week. Cities presently served include New York, San Diego Boston and Washington, D.C.
Six deals were available yesterday in Washington, D.C., but perhaps the most enticing was 50-percent off a 60 minute, "stress-busting, pain-zapping massage." Total cost - $35. I call that a good deal because there apparently are a lot of stressed out people in D.C.
6. Gilt City
I don't know about this site's slogan: "Bright lights. Gilt City." Perhaps it should be "Guilt City," since their deals are quite expensive.
Presently only available in New York City, each of Gilt City’s deals lasts for seven days and are updated weekly. Instead of trying to sell as many of their deals as they can, Gilt City’s inventory is apparently limited, and can sell out, much like the sales on sister-site Gilt.com.
Yesterday's deals included up to 60-percent off a "lavish day on the links" at the Hampton Hills Country Club on the tip of Long Island, or up to 48-percent off an eight-to-10-dish dinner at the Double Crown restaurant in New York's Bowery District.
7. Juice in the City (JITC)
Calling all coupon-loving moms: Juice in the City will soon cater to your need for fun activities (and only activities). It's a smart mommy model and sets JITC apart from the growing crowd. So far, juicy juice only displays what appear to be potential daily deals within the San Francisco and Seattle-Tacoma areas and is operating without outside funding.
This week's proposed Seattle activity looked like a lot of fun: Get your hair colored and cut at SEVEN Salon while listening to music spun by a DJ and sipping an espresso or latte. The come-on must be pretty enticing to tired moms: "When you walk in, you're greeted and immediately whisked away as though you were Shiloh's mommy showing up at preschool…"
8. We Give to Get (WGTG)
Sadly, only Windy City citizens can take advantage of the unusual We Give to Get buying site -- so far.
Here's their unique model: Each person who creates an account also automatically registers with the charity website ActOfGood.org. Whenever you buy a "GO-GO" coupon, 10-percent of the money you spend while using the coupon is donated to the ActOfGood charity of your choice.
It seems like an unusual idea to connect a money-saving action to a money-giving one, but as they say, “opposites attract.”
WGTG doesn't require a minimum number of people to sign up in order to make the deal valid, and the coupon is sent to the buyer by email after the purchase is completed.
My favorite deal for yesterday included two sessions with a personal trainer for $60 (regularly $160), and not just because former accountant Mark Beier is one hot hunk.
This Tampa-based site has chosen some rather interesting cities in which to start-up. You'll present find daily deals in Albany, N.Y.; Atlanta; Austin, Texas; Boston; Charlotte, N.C.; Denver; San Francisco; and Tampa Bay, Fla.
CrowdSavings features one local business per day and doesn't have a minimum target for people to take advantage of the deals. Many vouchers can be given as gifts and some are good for up to six months.
Recent deals in Albany included a $10 NY Style Pizza for just $1 (wow!) and $40 worth of tickets at FunPlex Fun Park for $20.
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