Study says most local merchants that have tested group-buying platforms do not plan to repeat.
Fifty-five percent of small businesses that have tested group-buying platforms like Groupon and LivingSocial do not plan to use the services again, according to a new MerchantCircle study. The online business directory's research supports Rice University's study last fall that found one-third of businesses' Groupon campaigns were unprofitable.
MerchantCircle surveyed 8,456 SMBs, while 6,874 responded to the question about group-buying deals. Of those, 23 percent (1,568) had offered a daily deal. From that number, 856 stated they didn't plan to repeat the strategy, and 712 said they would try group-buying platforms again. More than 5,300 said they've never offered a daily deal.
SMB Surprise: 32 Percent Use Facebook Places
The study delivered much better news for Facebook's mobile and local marketing aspirations. Thirty-two percent said they had used the Palo Alto, CA-based company's six-month-old Places platform to promote themselves. Another 12 percent stated they plan to use the geo-social platform in the coming months.
Overall, around 70 percent of those surveyed use Facebook.com for promotions. According to MerchantCircle, that number is up from 50 percent last year and beats Google, which is being used by 66 percent.
Foursquare's usage among local merchants has risen from 2 percent in 2010 to 9 percent this year.
Most Local Merchants Spending Less Than $2,500 on Marketing
According to MerchantCircle's data, more than half of local merchants' marketing budgets were less than $2,500 in 2010, and 60 percent do not plan to increase those spends this year. Twenty-six percent of the survey respondents cite high costs as their No. 1 complaint about online marketing.
Not surprisingly, 37 percent of the SMBs said that lack of time and resources are chief online marketing challenges.
On the heels of a fantastic event in New York City, ClickZ Live is taking the fun and learning to Toronto, June 23-25. With over 15 years' experience delivering industry-leading events, ClickZ Live offers an action-packed, educationally-focused agenda covering all aspects of digital marketing. Register today!
Christopher Heine was a senior writer for ClickZ through June 2012. He covered social media, sports/entertainment marketing, retail, and more. Heine's work has also appeared via Mashable, Brandweek, DM News, MarketingSherpa, and other tech- and ad-centric publications. USA Today, Bloomberg Radio, and The Los Angeles Times have cited him as an expert journalist.
Hong Kong, May 5-6, 2015
Gartner Magic Quadrant for Digital Commerce
This Magic Quadrant examines leading digital commerce platforms that enable organizations to build digital commerce sites. These commerce platforms facilitate purchasing transactions over the Web, and support the creation and continuing development of an online relationship with a consumer.
Paid Search in the Mobile Era
Google reports that paid search ads are currently driving 40+ million calls per month. Cost per click is increasing, paid search budgets are growing, and mobile continues to dominate. It's time to revamp old search strategies, reimagine stale best practices, and add new layers data to your analytics.
May 6, 2015
12:00pm ET/9:00am PT