Work Daily Deal Customers to Return

Reports of the death of daily deal programs are not only exaggerated, but, it appears, incorrect. In a MerchantCircle survey conducted last month, fully 75% of small business owners who had offered a daily deal said they’d offer another one in the future.
     Their reasons reflect the merchants’ growing sophistication in overcoming two of the most common complaints about the programs: One is that bargain hunters use the coupon, only then to flit on to another bargain at another retailer. The second is that the combination of discount price with administrative costs results in a net loss.
     In the MerchantCircle survey, 37% of merchants who used daily deals reported solid profitability. This is still a minority, but a noticeable increase from the 24% figure in last June’s survey. And more than 60% of those merchants saying they’d repeat a daily deal gave as a reason its effectiveness for customer acquisition.
     At the same time, of those who said they wouldn’t repeat a daily deal, 42% said it was not effective for customer acquisition.
     What made the difference? Probably emotional connection. When any customer comes to your place of business with a daily deal coupon, build an emotional connection. And as you choose among emotions, go for gratitude over happy. It's more profitable to have our customers grateful to us for what we're doing for them than happy about the consumption experience.
     Research at Università Commerciale Luigi Bocconi in Milan, Italy looked at relationships between six emotions and what the shopper with those emotions did after completion of the purchase. The six emotions were anger, gratitude, guilt, happiness, pride, and sadness.
     The greater the extent to which customers said they felt grateful to the retailer for helping to solve a problem or satisfy a need, the more likely the customer was to praise the retailer to others and to say they intended to spend their money with that retailer again. In the study, there was no significant relationship between customer happiness and either positive word of mouth or repurchase intention.
     There are a great many considerations in your deciding whether to launch a daily deal promotion. If you do, be sure to cultivate in each daily deal customer a sense that they owe you for what you’ve done. When the deed being done is a substantial discount on quality products or services, working the relationship for gratitude is a natural.

Click below for more:
Update Perspectives on Daily Deals
Fine-Tune Your Social Couponing
Go for Customer Gratitude and Guilt
Have Unannounced Discounts on Common Purchases