While the daily deals market has become increasingly crowded over the course of the past year or so, it would appear that all of the newcomers (and even those companies that have been at it for awhile) have a long way to go before they’re going to catch up with Groupon.
A new report from the customer satisfaction research firm ForeSee Results offers a glimpse of the state of daily deals industry, revealing the Groupon has carved out a dominant position that puts the company head-and-shoulders above its competition and should, for now at least, quell any concerns about the long-term viability of the Groupon business model.
ForeSee based its report on a survey this spring of more than 22,000 shoppers who actively use many of the web’s top retail sites. Of those polled, nearly two thirds of respondents indicated that they subscribe to at least one daily deal offering.
More than half of those consumers (51 percent) said they subscribe to Groupon, giving the company a commanding two-to-one lead over its next closest rival, Living Social. Only 24 percent of the respondents said they subscribe to Living Social, while 14 percent use Google Offers and 10 percent rely on Woot.com, which was purchased by Amazon in 2010.
The research seems to counter many in the industry who have questioned the sustainability of Groupon’s business model, particularly from the standpoint of attracting new users.
“I don’t think anyone should be signing any death certificates yet,” ForeSee CEO Larry Freed wrote in a blog post about the report. “Groupon and LivingSocial do bring in new customers, and that should be welcome news to both retailers and daily deal companies alike.”
Indeed, ForeSee’s research shows that 31 percent of the consumers buying daily deals were new customers to the merchant offering the deal itself. Only slightly more (38 percent) were frequent customers, while 27 percent were infrequent customers and 4 percent were former customers.
And further reinforcing just how popular daily deals have become, the data reveals that more than two-thirds of the respondents have purchased a deal in the past three months and 89 percent of those redeemed their deal in that time as well
So what about you? Where does your daily deal allegiance lie? Leave us a comment!