Consumer Purchasing Decisions, the Fall of Daily Deal Sites, and B2B Group Buying

by Townes Haas
3/7/2014 12:44:17 PM


Have daily deal sites coached consumers to only buy heavily discounted goods and services?
So called “Deal of the Day” websites like Groupon, LivingSocial and others catapulted group buying into popularity, allowing customers to purchase goods and services at rock-bottom prices. The growth of group buying platforms has been so intense that niche sites have been created for everything from designer fashion to vegan foods, and recently business-to-business (B2B) group buying sites have entered the scene.

Despite news surrounding Groupon’s downfall, group buying in the business to customer realm is still relevant, and a2013 study from Ryan Partnership found that daily deals sites and emails were the most likely to fuel impulse purchases.

Is the “Groupon Effect” real?
Have daily deal sites coached consumers to only buy heavily discounted goods and services? Some merchants argue that these daily deal sites are coaching consumers to expect to pay very little for items, and killing profits for small business.

But, there are signs that the Groupon effect is fading as consumers grow weary of daily deal websites.

Consumers are experiencing deal fatigue
After the daily deal frenzy of 2010 and 2011, growth fizzled out. 2012 and 2013 saw consumers experiencing “deal fatigue” and weariness toward irrelevant, mass emails each day.

Consumers still appear to be utilizing daily deal sites, but the rapid-fire growth these sites experienced hasn’t lasted.

Businesses, however, will continue to use group buying platforms
There have been stories about how Groupon ruined small businesses, but feedback from small businesses seems to be mostly positive, and many say that daily deals have improved their profits and helped them acquire new and repeat customers.

Even though consumers may not be a deal-crazy as they have been in the past, if businesses are still offering deals, savvy customers will continue to purchase them.

Does group buying exist for B2B services?
Despite the huge success of business-to-consumer group buying sites like Groupon, promotions and low cost options for B2B services aren’t as well known. But, the good news is that they do exist!

Businesses can utilize their collective buying power to score deals on business supplies and services, like search engine optimization from Moz or press release services.

What are some of the top B2B group buying sites?
·Rewardli offers special deals and promotions on business services, such as 30 days free and 10% off of GoToMeeting and advertising credit from Twitter.
·OrderWithMe allows small businesses to aggregate their inventory purchases with other small companies to get the best pricing from their network of suppliers.
·BuyerHive is a paid membership based site that offers business owners the chance to grab goods and services at low prices from more than 300 suppliers, including major companies like Amazon, Best Buy, and Staples. Buyers can earn cash back, too.

What are the benefits of B2B group buying sites?
Business-to-business group buying services offer benefitssimilar to consumer deal sites, and are perhaps even more pronounced for smaller companies.

Group buying sites let businesses band together and purchase only the inventory that they require, securing pricing usually reserved for large orders. These sites also let businesses test out services they might not otherwise utilize, like advertising on Twitter or search engine optimization from Moz.

Group buying isn’t just for the business-to-consumer world
While B2B group buying sites are still in their relative infancy, they quietly endure. Perhaps this is a good sign – rapid growth and hundreds of websites catering to this territory could be bad news, if Groupon’s story is any indication.

Additional Resources to Help Grow your Small Business

White Paper

How Mail Services Help Entrepreneurs Succeed

In today's mobile economy, digital entrepreneurs often work from varying locations. While this can help save money and increase agility, it comes with one big drawback:

Read More >
White Paper

Virtual Assistants Provide a Competitive Edge

Countless small business owners rely on remote assistants or offsite receptionists to help with critical organizational duties. While some are content to offload simple tasks to self-employed, stay-at-home support people, others demand more comprehensive services...NULL

Read More >
White Paper

Virtual Assistants & Remote Assistants: A Comparison

While the traditional virtual assistant is likely to work from home, an executive-level virtual assistant is part of a greater brick-and-mortar presence. This fundamental difference opens the door for extensive training opportunities that broaden the professional's support capabilities.

Read More >
White Paper

Overview of Virtual Offices, Executive Suites and Co-Working Spaces

Work has changed. In an age of instant communication, cloud-based applications, and workplace versatility, the era of the traditional office culture has come to an end. Providers of virtual offices, executive suites and co-working spaces have effectively liberated the nation’s work culture, adding dynamic and energizing new choices...

Read More >
White Paper

Part 1 of 4: Introducing the SBA

For entrepreneurs and small business owners, navigating the tricky terrain of creating a sound business plan, forecasting for growth and developing an operative growth strategy can be a major challenge. Fortunately, American entrepreneurs and operators have access to one of the most effective resources in the worldwide market...

Read More >
White Paper

Part 2 of 4: Starting a Small Business

Navigating the complex terrain of creating a sound business plan, forecasting for growth and developing an operative growth strategy can be a challenge for entrepreneurs and small business owners. Fortunately, American entrepreneurs have access to one of the most effective resources in the world via the Small Business Administration (SBA).
... Click to read more

Read More >
White Paper

Part 3 of 4: Managing a Small Business

Congratulations! You have gotten your small business up and running. Now what? This part of our four-part series on leveraging the Small Business Administration to help you launch and manage a small business will focus on the operational aspects of running a business. Whether you need leadership strategies, day-to-day decision making skills
... Click to read more

Read More >
White Paper

Part 4 of 4: Marketing, Sales and Contracting

Understanding marketing and sales as well as the technical complexity of our Internet-driven society gives entrepreneurs a distinct advantage over the competition. This final segment of our four-part report will take a deeper dive into the logistics and philosophy of marketing and sales and their impact on your business success.
... Click to read more

Read More >
White Paper

DIY Marketing Tools

If a business isn’t marketing, its potential customers are not finding it. Small to medium size businesses often struggle with spending hundreds of thousands of dollars on marketing. New DIY marketing tools, however, have eliminated the need to spend astronomical amounts on online and traditional marketing. These tools
... Click to read more

Read More >
White Paper

Virtual Office for Legal Professionals

Law firms (large and small) and solo legal practitioners alike can use virtual office services and spaces to run their entire legal operations or as a supplement to a home office or traditional brick-and-mortar offices. Virtual office services can be particularly useful during trial preparation
... Click to read more

Read More >
White Paper

Finance & Tax Professionals

Finance and tax professionals, whether they work solo or as part of a larger firm, can use virtual office spaces and services to stay on top of their workloads, especially during the busy tax season. Professional virtual office spaces can be particularly useful when back-to-back client meetings are necessary...

Read More >
White Paper

Traveling Entrepreneur

As business people and entrepreneurs continually strive to grow their business, doing so frequently involves traveling around the country to attend networking or tradeshow events, meeting clients and prospects on their own turf, and getting some face-time with colleagues, contractors or employees who may operate in a remote location. Preparation
... Click to read more

Read More >
White Paper

Virtual Office Eguide

Have you ever wondered why some small businesses are successful and others are not and what do these successful companies do to gain an edge over their competition? Through our years of experience
... Click to read more

Read More >