Free deals

Monday, May 2, 2011

Some deals on a daily-deal site have a really low cost to get as many people as possible to buy coupons. It is even possible to run a free "deal", that is a deal with zero cost. When the deal price is zero, the Getsocio engine will not even ask for credit card and just will give a coupon to any user who clicks "Buy" button.

Running a free deal could be a great way to promote a new business. Sure it has drawbacks, as people will clearly see that it is an advertisement rather than a real deal, and will be more cautious.

Of course, the "free" deal is not entirely free. While users get their coupons at no cost, a "free" deal usually has some cost charged from the vendor for the promotion. On Getsocio for the deals with the price less than $1, including free deals, the transaction fee is calculated as if the deal cost was $1. So if you run a zero cost pure promotional deal, each coupon will cost you 5% of $1, that is $0.05.

While tempting, it would not be reasonable to start a daily deal site with free deals. When your subscribers get used to free stuff from the day one, it will make them angry when you run your first non-free deal, and many of them will get mad and unsubscribe. Much better strategy is to start with a low cost $5-$10 deals, and introduce more expensive deals later.

But for an established daily deal site with a solid subscriber base, an occasional free promotion, especially holiday/entertainment one, could be an exciting addition.

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