The Emperor Has no Daily Deals

When Montreal-based deal distributor DealMango launched, it trumpeted a new tactic that was nothing short of revolutionary. Consumers could tell DealMango what they wanted to buy on the cheap. In fact, the company’s slogan is “Tell us; we’ll get it.”

Not surprisingly, the reality is a little less sexy.

According to Robert Gervais, the company’s president, DealMango’s business plan is dependent on the economies of a group-buying model. Like Groupon and LivingSocial, DealMango entices merchants to participate with the promise that increased sales volume will compensate for reduced margins. The company does indeed invite consumers to express their desires. But even though the company’s press materials and most of the press attention it received last week seem to indicate that, once a consumer says what it is that he or she would like to pay less for, poof!, a deeply discounted coupon for the item will appear, that is not the case.

The fact is that once a consumer expresses a desire for a flat screen TV, gym membership, or tropical vacation, nothing happens. At least not right away. And, maybe never.

The items consumers request are sorted by category, and other consumers visiting the site can browse those categories. If, for example, a consumer requests a good deal on a treadmill, other consumers will be able to view that request, and, if they too are in the market for a treadmill, they will be able to sign on. But until enough consumers decide that they would all like cheap treadmills, nothing happens. And only when the number of consumers wanting an off-price treadmill actually hits critical mass, does DealMango even go looking for a retailer interested in selling them cheap. At that point DealMango will send all of its subscribers an email, offering them a 30-percent-off coupon for a treadmill. Just like Groupon and LivingSocial. So much for the revolution.

https://digiday.com/?p=4774

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