Today’s musing – you’ve seen them for years; they’re at the national level and at the local level. “Daily Deals”. They come under an array of different names. A “ganga” “get-it-before-it-expires” offer, supposedly for at least 50% off regular prices. I say “supposedly” because some merchants game the system by advertising a much higher regular price on the daily deal description than is advertised in their actual websites!
I’m often asked if I do daily deals on my cellulite treatments and/or wrinkle treatments. Not anymore! “Been there done that” as a merchant AND as a buyer!
A Wake-up Call
As a buyer I loved daily deals! They were my most eagerly anticipated SPAM every day! I was fairly new to Tucson, single, barely knew my way around town, and buying daily deals forced me out into my new community, trying new restaurants, partaking in new activities, helping me find new personal care providers, and enjoying indulgences like massage! I found massage to be cost-prohibitive so, committing to no one, I bought every massage daily deal that was within a reasonable drive, tipped well, and if I was out of daily deal coupons, returned once or twice afterward at regular price.
But then one day there was a daily deal for AT HOME massage! “Are you kidding me?! There are massage therapists who will make house calls?! I won’t have to lose my ‘massage high’ immediately afterward while I drive home?! OMG! Sign me up!” I was sold after redeeming that deal! I became a loyal once-a-week customer! For that business owner, the daily deal did exactly as it was intended to do!
It Just Wasn’t Meant to Be
One day the owner, Linda, called me to tell me she was closing. “Oh, say it ain’t so!” And that’s when I learned the ugly truth behind these spectacular deals. While you and I are enjoying a 50% discount (at the business owner’s expense), the daily deal outfit keeps 50% of what you and I pay, releasing to the business owner what’s left of the other half after deducting admin fees. Do the math…the business owner earns slightly less than one-quarter of his/her normal fee! To make matters worse for Linda, while she’d agreed to run a one-day deal to get widespread exposure, the company kept running little intermittent “side deals” in the months afterward. She netted less than $10 per massage deal, and she had to drive to somebody’s home in order to honor the deal – so one-hour massages cost her more than 60 minutes’ time. Daily deals proved to be the downfall of Linda’s business.
Then my stomach sank as I thought about all of those massage therapists’ deals that I purchased with no intention of coming on board. I feel just awful to this day about that; hence, don’t partake in such deals anymore.
Is Anybody Thriving?
Maybe daily deals are profitable for the business owners who mass-produce, and maybe it helps restaurants prevent as much waste since they can sell, rather than throw away, perishables that are on their last days; but for one-on-one personal care solopreneurs, providing a full service for 75% less than normal, hurts. It really, really hurts. But they’re sold on the daily deal outfit’s sales pitch of “Sure, you won’t make any money from the deal, but just think about all of the repeat business you’ll get.” Though, I have no doubt this concept has helped many new and/or struggling businesses, “retention” isn’t always the reality. Daily deals have given birth to “daily deal hoppers”. Oh, and the TV commercials are especially offensive! They suggest, “Pay 50% less for the things you’re going to do anyway”. What I, as a merchant, hear in that is, “Why pay your normal hairdresser the normal $50 as you’d planned on doing anyway, when you can give him/her this coupon and we’ll pay him/her $12.50?”!!!
Why Didn’t I Listen to my Inner Voice?
I should have learned from what happened to Linda, and from good old-fashioned common sense! One day out-of-the-blue my landlord knocked on my door and told me the county had changed his home’s zoning. What did that have to do with me? Well, it meant I could no longer rent his guesthouse – my home where I had peacefully and happily resided for more than four years. Oh, I found a new home; it was in a great area, it was much larger, had a beautiful pool, a couple of hot tubs, car port, an on-site HOA manager whom I just adored, and a price tag of triple what I’d been paying for the past four years! I had to increase my business volumes and I had to do it quickly!
“I know! I’ll run a daily deal!”
Oh, to be Able to go Back in Time and Slap my Younger Self Silly!
What I thought was going to happen is that I’d run a one-day, 50% off one Endermologie treatment deal, and that mine would be “the” deal of the day. The daily deal outfit had other, greedier, plans for me! For starters, I’d be one of many featured deals that day. There would be nothing prominent about my deal; users would have to scroll through pages and pages of deals to find mine. Oh, and I would not determine what the deal would be; no, the daily deal outfit would tell me what it was going to be, and if I didn’t like it, I didn’t have to sign the agreement! So, instead of the 50% off one treatment deal that I’d envisioned, the daily deal outfit told me there would be THREE deals and they would be as follows:
#1: 2 Body Endermologie Treatments 50% off
#2: 2 Facial Endermologie Treatments 50% off
#3: 1 Body and 1 Facial Endermologie Treatment 65% off
At least I had some semblance of autonomy in limiting it to “One per person plus one additional for a friend”. And I had the autonomy to turn off the campaign at any time. I was not allowed, however, to limit the deal to “New Clients Only”, so I chalked it up to “New Client Special” and “Loyalty Discount” and “drank the Kool-Aid”. I was not happy but felt stuck; my living expenses had just exploded, and I had only one (legal!) way to pay bills – Endermologie!
So, the Big “Launch Day” Arrived.
I expected my phone to start ringing off the hook first thing in the morning, but in reality, it was manageable. Fine with me, I wasn’t crazy about discounting my talents, anyway. As the days ensued, the calls picked up, and my calendar filled up. I performed thousands of dollars’ worth of cellulite and wrinkle treatments but received a check for several hundred dollars from the daily deal outfit every couple of weeks. Then the unthinkable happened – due to the daily deal’s increased wear-and-tear on my machine, I required a $3,600 repair before I’d even earned $3,600 from the daily deals!
Be Your Own Best Friend
And then there was the “Limit one per person plus one additional for a friend” caveat. So “Jane Doe” comes in, redeems her deal for two cellulite treatments, then makes another appointment. “Great!”, you’re thinking, “I converted her”. Then she presents you with another deal coupon saying that SHE is “her friend”! <sigh> Whatcha gonna do? You honor those two treatments, then she makes another appointment. So now you know she’s on board, you all excitedly administer that fifth treatment because now you’re going to earn some real money, but at the end of the session she presents you with another deal coupon!!!! Are you kidding me???!!!! The daily deal outfit had no mechanism in place for preventing cheaters! It was honor system! I told “Jane Doe” that she’d already exceeded the allowable number of coupons, so she’d need to pay for that treatment, to which she exclaimed that she didn’t bring her check book or charge cards! Give me a break!
That was the end of “Jane Doe”! While she was the most memorable, sadly, she wasn’t the only customer who was her own “friend” and got four discounted treatments out of me.
Passing the Buck
But my personal favorite had to be the “I called you guys last month but nobody called me back” line ALWAYS, without a nugget of exception, 100% of the time, rolling off the lips of those who’d let their coupons expire! Holy cow, it was abundant! I even called one out once; I told her I didn’t see her phone number in my phone’s call history. “Uh…uh….well….uh….I called from a different number then”. Good grief! Give me a break! I do not NOT return calls from clients and future clients! I told those women to request a refund from the daily deal outfit. I have the utmost respect for the ONE woman who left me a message along the lines of, “Oh, boy, I sure let this one get away from me. It’s expired now, it only has face value left, so I’d love to come in for a treatment, and pay the difference.” Guess what? Because I admired her integrity, I honored the deal though it was expired.
Cream of the Crop
I don’t remember how long I toughed-out that daily deal, but at the end of the day most did not stay on board – “karma” for what I’d done to those poor massage therapists before I knew how these daily deals work, I’m sure! But five ladies did stay onboard long-term. Five really, top-notch, quality ladies with fascinating lives and histories! Five ladies who were still with me when I left Tucson for Phoenix! I only wish I could have met them on the hiking trails instead of through daily deals!
Cindy Baumann, Sleek Physique LLC
Expert Certified Endermologie Practitioner