Good deals? Daily coupon sites are multiplying
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Annette Mich of Prantl's bakery, which is doing its first offer this week.
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Prantl's Bakery co-owner Lara Bruhn wanted to check out the daily deal phenomenon popularized by companies like Groupon and Living Social, so she subscribed to a few of the sites. That set off a steady stream of email offers for yoga classes, restaurants and numerous teeth whitening services. "How white can your teeth really be?" she joked.
At this point, Ms. Bruhn is regularly deleting the e-mails. "Can you tell I'm just a little jaded?"
She also is fending off phone calls from numerous deal sites that think their lists of consumers would be a perfect fit for her Shadyside-based bakery. The calls started around a year ago, but they've intensified in the last six months.
"I'm not kidding, I probably get a call a day," she said.
The daily deal industry -- and it seems to have become an industry almost overnight -- began as almost a novelty but is now under intense scrutiny since some of the major players are seeking to sell stock. Groupon's planned initial public offering, in particular, has given investors a chance to analyze the numbers behind the 3-year-old company's dazzling growth.
The Chicago company, founded in late 2008 by a Mt. Lebanon native, told the Securities and Exchange Commission that, as of June 30, it had 115.7 million subscribers in 45 countries.
How fast has it grown? Consider the company's disclosure that it sold 116,231 Groupon deals in the second quarter of 2009. Two years later, the same quarter brought sales of 32.5 million deals.
Also in the second quarter, Groupon reported a net loss of $102.7 million on revenues of $878 million.
In many ways things don't look good for the daily deal industry. The biggest player is having a hard time making money. More than a few businesses have offered deep discounts that ended up costing them money. And the competitive marketplace looks like a bar fight in an old Laurel and Hardy movie.
The daily deal field has grown to include more than 600 players, including destination sites, newspapers such as the Post-Gazette, radio and TV operators, flash sales sites and others, according to a report Tuesday from BIA/Kelsey, a local media consultant based in Chantilly, Va.
First Published September 15, 2011 12:00 am
