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ONSDAG23.APRIL2014

Walking the plank Downtown What i s t h e f u t u r e o f D a n i s h dea l sites? T her e a r e m a n y dea l s it es at the mo m en t a n d t h e n u m ber of them i s r i s i ng.

KATHRINE A, PHILLIP D, SVANTE F, DORTE H, EMILIE H, SOFIE J, MATHILDE M, SOFIE P, LOUISE R, MARIANNE S, RASMUS T.

T

oday there are about 30 different providers of deal offers in Denmark alone and the number is only increasing. Research shows that the

customers are rarely loyal for each of the different sites and that they instead mix and match offers according to interests and price proficiency. Deal sites will have to offer something special in order to keep a loyal and satisfied consumer base.

“A focus group research showed, that many don’t really have preferences for the deal providers, but

Downtown butikken ligger på trommesalen 7. 1614 København V

the deal itself was the crucial factor. Even the less known deal sites can have relevant and interesting

The last mentioned in our info graphic are excelling

This is something that the bigger deal sites dominate,

deals for the average consumer” – Says Shaun from

by having chosen a clear deal niche. It is to be

and something Downtown has done really well,

dealsites.dk to trendsonline.dk.

expected that the niche sites will keep their

averaging 8,5/10 on trustpilot.

All deal sites offer more or less the same thing.

customers when searching for an offer in a unique

There are lots of skincare, sushi, rubber boots and

category. This does not only imply the consumers but

Downtown

cheap charter vacations. Dealsites.dk and Bownty.

also their offer providers, who they need to keep a

As niche deal sites stand out just by servicing a

dk are deal aggregators and live from the disloyal-

good relationship with.

narrow market the bigger deal sites might also want or need to stand out in order to have a future. We

ty of their consumers in their chase of the ultimate offer. The sites offer a personal deal search as well as a collection and comparison of the countries best deals. A lot of deal sites see an extreme growth in the entry phase and a quick expanding customer base, client

“A major game changer for most of the deal sites, that do not want just one focus area, could be toreach their customers in a different way than usual.”

have seen that Downtown has tried to do so by opening a physical retail store in Vesterbro, Copenhagen. Unfortunately retail stores are already having a hard time selling products because of the incline in online retail, so now they not only have to

base and staff hiring. This breeds more and more

Today most sites use email subscriptions as their

focus on their deal site but also on the declining retail

providers and fires up entrepreneurs who all want

main source of advertising but most consumers

market.

a glimpse of the treasures. The main reason for the

regard these emails as spam. Some of the deal sites

flooding of deal site startups is because of the

have even started to use apps where the deals you

minimum level of skill it takes to make an easy profit.

see are the ones near your location, which works

You need a decent website template, a few offers

very well when executed correctly. Smartphones and

from external deal providers and there you go –

applications are increasing purchases even though

Currently the store works like your local post office,

10 % of every sold item. Even if you are a new site

most of these customers are from a younger target

you can order something from Downtown online and

with low traffic you will still be shown on the deal

group.

then pick it up in the store so you do not have to pay

“So what could the physical store do in order to benefit the company?”

delivery costs. But the store could even create

aggregator sites. Point system

revenue if they sold products that were not available

“In a few years I think, it will fall to around 5-10 deal

Another thing deal sites could do in order to keep

online, in hope of additional sales to store guests.

sites. There is just not room for more than that – and

their customers would be some sort of point system

This could make the store more individual with its

there are not enough email addresses of profitable

that could have consumers coming back, if they

own products, but they could also have the store be

quality for more. It will most likely be the big guns on

could save extra on every 5th deal like buying coffee

a showroom for the

the market with a media house or ad network behind

with a coupon in a 7/11. In a community and

physical products they sell, with the option to try on

them that will stay. For example Sweetdeal,

economy where saving is very popular this could

clothes or feel the product in hand before you buy it.

Downtown, Dagens Bedste and ourselves.” – says

help them even further. A reward system or loyalty

So by tackling some of the bigger problems with

Tasha Michelle Masmas to 24timer.

program could also help the consumers that have

online shopping with their physical store they can

been using the site for a longer period of time with

give their customers a much better experience.

The niche deals

special offers that only they receive - this could

”Given how easy it is to find and buy books,

In march 2013 one of US’ largest deal sites Groupon

work well if the deal site does not use email listings

electronics, and other items online, why do

fired their CEO when they started to decline, they

regularly and only send out a couple each month to

people continue to buy in stores at all? The reason

were not able to make enoughrevenue for all of their

the loyal customers with special personalized deals

is that online buying generates what economists call

expenses which resulted in a restructure of their

for them.

disutility: inspecting digital products is

sales strategy. This is a clear expression of where

Another factor that most deal sites already focus on,

difficult, shipping can be slow or expensive, and

Denmark’s deal site market is currently headed.

which cannot be stressed enough, is customer

returning products can be challenging.”

About 30 deal sites of those existing in Denmark right

satisfaction and buyer’s safety - complaints need to

– Avi Goldfarb from the technologyreview.com.

now only a few have chosen a niche area or a

be handled with care and understanding. The staff

special way of offering new deals.

needs to be kind and see the issues the customer

Old fashioned deeds

has faced and handle it accordingly.

Another important factor, and this is not only for electronics stores but for all retail stores, is that in these stores it is not only the price that matters, which is usually the case for online purchases. But the old fashioned deeds which contain good professional guidance, local adaptation and a good business acumen. By selling a lot of different products it will be hard for Downtown to give a good professional guidance and they should therefore make sure that the solution they choose for the retail store is very specific.

Infografik, viser oversigt over de danske dealsites, anno 2014.


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