Transcript of DAILY DEALS TO DEALS OF THE DAY THE RETAIL PHENOMENA AND/OR MARKETING CURSE* *PRESENTATION PRIMARILY...
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- DAILY DEALS TO DEALS OF THE DAY THE RETAIL PHENOMENA AND/OR
MARKETING CURSE* *PRESENTATION PRIMARILY FOCUSED ON PRODUCT RELATED
OFFERS Michael Romanies FUEL Marketing and Sales
MikeR@FUELmarketingandsales.com Michael Romanies,2012
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- THE BEGINNING Woot.com (Want One Of These) Site Started in 1999
Acquired by Amazon 6/30/2010 (Est $110M 09) One Deal per day Web
only through 2011, then e-mail long after Groupon Channels added
Sold 1M t-Shirts in first 18 months, single press WootOffs and Bags
of Crap Woot, Yugster, Tanga, Deniath Amazon Gold Box &
Lightning Deals (acquired Woot)
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- THE TRANSITION The Nerds are overtaken by the Marketing Guys
(e-Mail Solicitation, then the lines BLUR )
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- PYRAMID POWER Groupon Living Social, KGB Eversave aDealio,
Moolala, Morgans List Revenue
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- DEALS OF THE DAY SITES THE MARKET The Players The 80/20 Rule
Groupon (39M+/49M+ domestic emails, est ~90M WW) Goods 39M+,
Grouponicus 29M+ Living Social (60MM+ World Wide e-mails) KGB,
EverSave, etc. all claim to be #3 1,500+ sites in 2011 Big Fish
Entering Google Rogers Communications CBS Facebook DOA
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- DEAL OF THE DAY SITES THE RIGHT RETAILER The Players cont.
Generalists Groupon, Living Social, etc. Oh yea Amazon & eBay
Themes Groupon Goods, Getaways, etc. Niche Players Gilt Group Totsy
Mommasource Deniath
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- GROUPON THE KING OF THE HILL Groupon Started Oct. 2008 By Dec.
2010 175 Domestic markets + 47 Countries, 33.7MM subscribers
Rejected $4BB and $6BB offers from Google ($2BB revenue at the
time), Mid 2011 Nov. 2011 IPO Valuation of $12.8BB raising $700MM,
Currently under $3BB Market Cap Groupon Goods ~ Sept. 2011 Test
first e-mail achieved estimated $2MM Revenue Estimated 2012 Revenue
of $600 - $800 MM By Comparison Groupon 2011 Revenue $1.6BB
(Billings of $4BB) Amazon 2011 Revenue = $48BB with projected 2012
at $64BB Living Social Shop (Goods) is projected to hit $200MM in 6
months this year Gilt Achieved a total of $500MM in 2011
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- GROUPON THE GROWING AMOEBA Groupon (The Deals of the Day)
Regional Offers Groupon Getaways Groupon Goods (1/wk to 3+/wk)
Groupon National Groupon Now! Groupon Gifts And then theres
Canada.. Groupon Regional Offers-- Groupon Quebec Groupon Goods
Canada Canadian National
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- IMPLEMENTATIONS - REDEMPTIONS Redemptions Voucher Codes
Services / Products Offer Period Voucher Redemption Period
Redemption Post Redemption Period & Valuation Stored Value,
escheatment- Abandoned Property Special Case - Now Deals Daily
Cut-off, sales are NET redeemed and verified Product Redemptions
Delivery, POD, Tracking, Response Times
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- ( OF OF OF OF .)^3 AKA THE DEAL The Mantras BigLots!: Name
Brand Products at Discount Prices Tuesday Morning: Branded products
at Savings of 50-70%+ to the consumer DOD Sites: Deals at 50% or
More off As Fast as Amazon** Branded vs. Unbranded products and
services Effect Discount and Margin Effect Sales Product/Service
Categories Effect discounts and margins and delivery
expectations
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- DEAL SKINS Daily Deal/Deal of the Day Durations of Sale
Duration of Redemption Un-redeemed Dead or the Undead Zombies Run
of Sites Discounted Currency Catalogs (emerging) Complimentary
Offers (emerging) Niches expanding Themed Offers
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- CAVEAT VENDITOR (SELLER BEWARE) VENDOR CONSIDERATIONS AND
GOTCHAS Pricing The Discount (consumer) Marketing Services,
Commissions, etc. The Hidden Fees CC Fees (on the DEAL value
2.5-2.9%) DFIs Pick-up Returns Allowance Taxes Returns and
Cancellations (Quick Redemptions) Cash Flow Lost Shipments
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- CAVEAT VENDITOR (SELLER BEWARE) - 2 VENDOR CONSIDERATIONS AND
GOTCHAS - 2 The Title Whose Sale it is? Exclusivity Region
Bundle/Price Time Period Redemption Period of Deal Residual Value
Voucher Redemption Late Returns
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- OTHER CONSIDERATIONS KNOW WHO YOU ARE DANCIN WITH Demographics
M/F Groupon vs. Amazon Age Income Region Loyalty & Up-sells
List Games (Amazon TOP XX) Post Sale Halo Sales Negation of
Negative Reviews Brand Bragging
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- DEAL INGREDIENTS RECHECKING THE RECIPE Inventory (Physical,
Time & Resources), Availability Deliveries and 3PL Pricing,
Margins, Packages & Bundles The Terms (Tips, Hours/menu
restrictions, etc.) The Up Sell Recurring Revenue Opportunities
Cash Flow Delivery Out of Pocket Receivables Cancellations Currency
& Taxes Oh Canada!
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- WHY ME (YOU)? Customer Acquisition Cost Annual or Perennial?
Launch - Sampling Overstock (Inventory Limits) Out of Season
Fashion Changes Holding Costs Seeding next year Up-sell opportunity
Grill Only Menu items no Bundles Older versions Marketing Expense -
Advertising
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- WHY ME (YOU)? 2 THEIR PITCH Customer Acquisition Cost Branding
(Brand Advertising vs. Transactionary Advertising) They (vendors)
are paying a premium for PPC, Key Word search, emails, etc. just
for 'eyeballs'. Groupon delivers that kind of exposure + actual
buyers at either a fraction of the cost, and is the case with high
margin businesses (software, subscriptions, printing, many
services, etc.) even doing a huge profit. Most businesses put a $
value on acquiring a new customer because they know the repeat
buying habits will yield X ROI. The cost of acquiring a customer
through Groupon is always a fraction of that value and that doesn't
take into account the number of 'eyeballs' from people who didn't
buy the deal. In most cases, Groupon is a windfall for businesses
(especially online businesses) looking to generate brand awareness
and word of mouth.
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- MY CRYSTAL BALL Legislation & Litigation will solve all of
the grey areas within 2 years (Michael Romanies 2010) Consolidation
& Specialization Channels Too big to fail = Too big to continue
the growth rates at status quo Features for up and cross-sell
(Netflix, Amazon) Niche Database Mining & Niche e-lists go
deeper & wider 3PL goes Regional (Amazon, Google
announcements)
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- EXAMPLES Honestetch VHS to DVD: a TOP 100 Deal Site Product
(Yipit) Groupon, Living Social, KGB, Eversave, Google, DealFind,
DealSave, Moolala, AAA/digistrative, DailyDeals, Spotlight Denver,
DealGenius/Ebay, Amazon Honesetch Audio Recorder Deluxe/Plus, Film
Scan & Save The Clicker Universal Remote w/Bottle Opener
Groupon, Google Serif Graphics Software (Digital Download) Groupon,
KGB, rDeals, Google Total Training Training (Web Subscription)
Secret Styler Fashion Accessories Nitro Strike Fire Extinguishers
BottleBoss Wallet Credit Card Bottle Openers
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- DAILY DEALS TO DEALS OF THE DAY THE RETAIL PHENOMENA AND/OR
MARKETING CURSE Michael Romanies FUEL Marketing and Sales
MikeR@FUELmarketingandsales.com
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