Tuesday, October 12, 2010

Trying to Out Groupon Groupon

When is a newspaper more than a newspaper?

Answer: Now.

Tuesday, October 12, 2010, the Austin American-Statesman announced another interesting possible revenue stream having absolutely nothing to do with journalism but everything to do with money.

“Dealswarm” is the newest product of the Statesman and Cox Media Group (CMG), the Statesman’s parent company. What’s Dealswarm? It’s “a new group-buying discount program,” according to their news release. It “will soon offer bargain hunters in Austin outrageous online discounts of 50 percent or more on local dining, entertainment and other services from some of the most popular local businesses. Customers can now simply and quickly register on dealswarm.com to receive daily e-mail alerts about discount offers in their area. In the next few weeks, daily DealSwarm deals will be ready and available for purchase.”

Sounds familiar? Sounds like Groupon?

“Groupon started in November 2008 … to make it easier for people to enjoy the great things in their community. We do it by offering daily deals at unbeatable prices through the power of group buying,” according to the Groupon website.

Michael Vivio, Austin American-Statesman and austin360.com publisher, thinks Dealswarm can out Groupon Groupon. “We believe we can be successful in the space because of our large database of readers (who have already signed up to receive deals) and existing local business relationships,” Vivio says. “Those two factors combined with the promotional power of the Statesman and our websites will give us a quick entry into the market.”

So, like Groupon, users will sign up for daily email notification of the specials for the day. “This new product will give customers unprecedented access to some of the hottest local retail discounts not found anywhere else, and will help local advertisers and businesses promote themselves effectively to existing and new customers,” according to the Statesman release. “The Statesman Co. is excited to be a player in the growing deal-of-the-day market,” Vivio says.

Cox media is also rolling out Dealswarm in Atlanta, Dayton, and Seattle, and more markets are coming in 2011.

“Different from others in the group-buying space, our local media properties in each DealSwarm market bring unprecedented marketing power with established readers, viewers and listeners,” said David Shipps, DealSwarm’s Vice President in the Cox news release. “For our business partners, there are no upfront costs. They simply benefit from new customers and a fantastic promotional opportunity for their business.”

Shipps added that the program will be promoted by CMG’s radio, TV and newspaper websites, Facebook applications and Twitter accounts in each market, and through their respective e-newsletters on the day deals are available. The program will also be advertised on air in certain markets with TV for additional exposure.

So, Dealswarm is the Statesman’s latest partnership following boocoo.com, a competitor to eBay.

“Our BooCoo partners said they are well above their growth projections. But, since it is a start-up effort, it is not producing much revenue,” Vivio says. “They are building traffic much faster than other auction start-ups thanks to the newspaper promotion, they say.” A quick check of the www.boocoo.com site does show that they have products for sale.

The Statesman also partners with Monster’s Hot Jobs and AutoTrader.com.

© Jim McNabb, 2010

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