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The Advantages and Disadvantages of using a Group Buying Websites
Starting a new business or growing an existing service based business requires getting first time customers through your door and then getting them back again.
The challenge is to attract as many new customers to your business at minimal cost without impacting your cash flow.
Question: Is there a magic solution that will attract new customers and grow my cash flow at the same time?
Answer: There is no magic solution but using a Group Discount Buying website to sell your services will attract new customers to your business and increase your cash flow at the same time.
How it works: Group discount buying websites will offer a daily discount deal to their member network to sell coupons for your services over a 24 hour period (Daily Deal).
The coupons are advertised at a discounted rate to your regular service price, based on a minimum group purchase. The deal is only activated (deal is on) once a minimum group purchase is achieved.
When the deal is completed the coupons (vouchers) are emailed to the customers and then redeemed at a later date.
Group discount buying deals often sell 100’s to 1000’s coupons in a 24 hour daily deal period.
What are the advantages?
The advantages of running a Daily Discount Group Buying Deal include:
- Your business will receive upfront payment for your business services
- Quickly build a customer base and get new customers to your business
- Build brand awareness (People will see the deal and remember your business brand)
- Ability to convert new discount paying customers to repeat full paying customers
- Gives opportunities to up-sell your services and products
- Allows your business to focus on providing quality service instead of chasing new customers
- Less than 100% of coupon redemption compensates for offering a discount (Coupons need to be redeemed prior to the deal expiry date)
- Cheaper than direct advertising (Traditional advertising costs are expenses with no guarantees or a sale)
- Free social media advertising * No up-front costs
What are the disadvantages?
The disadvantages of running a Daily Discount Group Buying Deal include:
- You need to offer a discount to your retail service price (discount of up to 50% off the retail price are common)
- Your ability to service a large influx of new customers (over-stretch your staff)
- Managing the booking process, you may need to employ extra staff to book 100’s of appointments in a single day
- You business may lose money per individual customer
Read more: Group Buying online booking process using bookitlive http://www.bookitlive.net
