When Google’s six billion dollar offer to buy out Groupon was turned down last December, the Internet giant decided to create its own daily deal site. Google Offers (featuring discounts of 50% off and higher at local businesses) launched in Baltimore yesterday.
It’s certainly a good deal for Google and for consumers, and it may be bad news for Baltimore’s already saturated daily deal market. But what about the businesses that participate?
According to entrepreneur-blogger Rocky Agrawal, Google Offers (and daily deals sites in general) can be a losing game for businesses that participate. “The best customers for the deal sites are cheapskates who frequently buy deals. These are the worst customers for small businesses. Yet, [deal sites] are selling themselves as a way to acquire loyal customers.”
Agrawal also notes that the long term cost the business pays for a Google Offer promotion (in the form of deep discounts redeemed over the course of six months to a year) makes the venture easily as expensive as a print advertisement, which local businesses typically can’t afford.
What do you think? Have daily deal sites introduced you to businesses you now return to again and again? Or do you hop from deal to deal?