By Aimee Chanthadavong
It appears that Australian consumers are always after a good deal and know exactly where to look for one.
Daily deal websites have shown a 1000 per cent growth in visit in the past 12 months, according to figures released by Experian Hitwise.
According to the report, the huge surge in traffic has been boosted by longer browsing times, with the average time spent on these websites increasing by 153 per cent in the past 12 months.
Matt Glasner, Experian Marketing Services general manager, told RetailBiz that group buying sites are offering Australians the chance to get what they want at a lower price, making it remain the main driver behind the popularity of these sites.
“Consumers are generally happy to browse and shop around in order to find the deal that best meets their needs at that particular point in time. Although deal sites may all offer restaurant discounts, these offers will be for different restaurants in different regions, which will appeal to a different consumer catchment. It’s the diversity of offers in different localities that is enabling so many group buying organisations to be successful,” he said.
Australian businesses have been quick to jump onto the collective buying model with some of the most recent entrants – Stardeals and Cudo – being backed by leading global brands Groupon and PBL/Microsoft, respectively.
Experian’s data shows the entire Shopping & Classifieds category has increased by 9.11 per cent from 22 May 2010 to 21 May 2011.
According to Glasner, funding plays a signifcant factor in how much traffic is driven to each daily deal site.
“we can see that paid search traffic by these organisations is twice what you would normally expect. It’s an expensive way to generate web traffic,” he said.
“However, the key differentiator among the group buying sites is they are using social media channels very effectively. If we consider Stardeals, the number one driver of traffic to their site is Facebook. Even those brands that do not have access to significant investment, can start to build brand recognition through social media channels, in a way that hasn’t been possible for more traditional retailers.
“The third factor is the power of customer data held by group buying sites and, overtime, these organisations will become more intelligent about how they use this data. Customer information will be key to their long-term success and determine business growth, as well as their ability to respond and adjust their business model to market changes.”
Experian also shows that Australians initially found these websites through social media sites like Facebook, but are now visiting them through search engines like Google.
Traffic to coupon websites through email has seen the greatest growth with an 87.5 per cent increase in the amount of traffic going from email services to group buying sites over the last 12 months. This means websites are signing up new members regularly, and these same members are visiting the websites frequently due to daily coupon emails delivered to their inbox
Despite this growth, Glasner believes that based on the Experian data, the group buying market has yet to reach its peak as it is continuing to explode in popularity.
“Australian consumers are definitely looking to extract better value from retailers and we are witnessing a transformation in consumer behaviour, as people change the way they shop,” he said.
“We are seeing new entrants to the market on a regular basis, with activity on these sites representing additional online activity. Group buying is actually attracting more people on to the web and signifies new internet traffic, rather than taking internet time from existing sites.
“It also represents a fundamental shift in the way that consumers are using the Internet to drive value, where they haven’t been able to gain value from traditional channels. Retailers are reluctant to move on the threat posed by these sites, but they will need to follow suit if they are to remain competitive against group buying and discount online retail sites, like CatchOfTheDay.”