“Yesterday, Yelp ran its first daily deal in San Fancisco, and it killed. Yelp’s first deal was for a massage in San Francisco, which are relatively common in the daily deal space — a $110 massage for $49 from the well-reviewed Psoas Massage + Bodywork. How did it do? Really, really well. Yelp sold 1,616 deals at $49, or a total of $79,184.How does that compare to Groupon? Groupon sold three deals in San Francisco yesterday. None of them sold more than Yelp’s in terms of revenue or quantity. In fact, Yelp’s one massage deal brought in more revenue than all three Groupon deals combined. (Groupon’s three deals brought in a total of $67,398 compared to Yelp’s $79,184). Assuming Yelp pockets 30% (compared to Groupon’s 50%), the company took home $23.8K in a single day. That’s the monthly equivalent of 79 hard-earned small business advertisers on Yelp’s current advertising product.” – Source
Caraca! US$79,000 in sales in one day? No small feat. I know it was only a month ago that I wrote about Peixe Urbano but I’m just amazed at the whole concept and how it’s taking off. First Groupon, then Yelp to help it along by spreading the idea to a more general public and then we have successful copies in other countries. For those who are into technology, it’s kind of like the geo-location war between Foursquare, the early bird, and now Facebook Places, the latecomer. I think there’s enough to go around and besides, competition breeds inovation and diversification.
Essentially, though, what is really happening in the coupon space right now is they’ve found a way to take advantage of what happens to any business on a Tuesday afternoon. That is, wasted space (downtime). Think of an airline that only sells 50 of its 75 seats on a flight, that’s 25 seats they can never recoup. I’d bet these businesses are looking at these coupon deals as half free advertisement and half being able to sell their product or service during times when they are least busy. I’ll leave you with a screenshot of Pexie Urbano’s recent deals, where they list how many sold, the price sold at, the normal price and the savings to the customer. Doing the math…that’s up to you.