Monday, December 11, 2006
Social Deal Sites: Distribution and Business Models
I was intrigued recently by deals.com in a recent write up by Neil Patel and started this post as a deals.com critique. Comments on that post indicated that Deals.com is in a fairly crowded space so I decided to put them side by side for a nice half-baked Monday morning investigatory rant.For this quickie, non-objective stream of consciousness survey I looked (by looked for some of these I mean I opened them up in FF tab and glanced at the layout) at boddit, dealplumber, trezr, dealspl.us, dealigg, and redflagdeals.
Yes, those are all the ones that appeared in comments. No I did not investigate deeply into the space to find more. Six is quite enough for this Monday morning ;)
Here's what I think about when analyzing a deal site:
distribution
well SEO'd pages (title tags, url optimization)
encourage links by members (strong sense of ownership and community, more content than coupon submission so members will start to link internally)
encourage sending deals to others
deal plugins for other sites (let site owners offer deals to their visitors - not viable for those suckling at the AdSense teat)
generating deal content on site
user submitted deals
deal feeds from other sites
making cash
AdSense (boo!!)
paid as content distributor (yay!)
paying others to distribute deals you get paid to distribute (yay yay yay!)
Boddit
First off, Boddit barely fits in the social deal site category as far as I could tell. The only way that users can add content is in "reporting" to other users when a given deal is bullsh*t.
They feature feeds from approximately 11 deal sites (note to other deal sites - consider branching beyond user submitted if you haven't already ;).
Of today's compared sites they have gotten the most techerati attention from rags like Wired, Lifehacker and GigaOM which tells me they're based in the Valley or have good personal connections.
That and the fact that they seem to be proud of not making money with their service... they're trying to get bought or don't need money right now or are laying the ground work for CPC for when the online coupon space gets hot.
From an SEO perspective they don't seem concerned with distribution in the SERPs. Dumb.
And Boddit's the weakest when it comes to community.
Still, I think they have the potential for making the most money by getting paid by coupon distributors by the click or by the action.
Deals.com
Deals.com seems to be newer than Boddit and it's built on the Digg framework, apparently NOT on the Pligg platform (Dealigg IS built on Pligg).
What I like about Deals.com is how they emphasize their community with profiles and by glorifying top deal submitters with front page attention.
But then there's the CrackSense... So now let me rant a bit on how AdSense is a lazy business model cop out.
CrackSense is Not a Business Model
Yes, you have to make money out of the gate and yes AdSense is a great way to do that.
But deal sites, I think you should be looking more to the Become.coms of the world for your business models. No, they don't have the social goodness of the Digg model. But they're making money through direct relationships with advertisers.
They do this by having developed out their CPC system so that those merchants submitting feeds can measure the value they're getting from Become.
My Suggested Alternative
Get your business development mojo working. Determine who in the coupon and deal space is actually making money right now. Figure out how you can help them with their distribution problem.
Call up Zixxo and figure out if there's a way you can distribute their coupons and take a cut.
And most importantly figure out how YOU can become the next AdSense by aggregating all the paying coupon and deal feeds and enabling others to get paid by distributing them for YOU.
Easier said than done, right? Of course. So that's my half-baked Monday morning rant for you and I'd love to hear more thoughts about deal sites, how they could/should/will be making money, and their natural evolution with local and social functionalities.
Other deal sites:
dealplumber
trezr
dealspl.us
dealigg
redflagdeals
Google's Next AdSense Replacement:
google maps coupons (it will only get widespread distribution once they can start paying map builders to distribute them)
Posted By Garrett French at 10:09 AM
Permanent Link: Social Deal Sites: Distribution and Business Models
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