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Group Buying By The Numbers

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My presentation at BIA/Kelsey's ILM East on March 23, 2011.

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Group Buying By The Numbers

  1. 1. Group Buying By the Numbers<br />Jim Moran | @jdmoran | blog.yipit.com<br />BIA/Kelsey ILM East: Wednesday, March 23<br />
  2. 2. the market<br />
  3. 3. Low Barriers to Entry…<br />
  4. 4. …High Barriers to Scale<br />The Virtuous Cycle of Daily Deals<br />Source: Needham & Company LLC (Mark’s whiteboard)<br />More Cities<br />More Sales<br />More Salespeople<br />Improved Media Buying<br />More Conversions<br />More Deals<br />More Deal Personalization<br />More Subscribers<br />
  5. 5. The Daily Deal Stack<br />Daily Deal Sites<br />MERCHANTS<br />CONSUMERS<br />Vertical Deal Sites<br />White Label<br />Publishers<br />Data<br />Merchant Services<br />Exchanges<br />Aggregators<br />Consumer Services<br />Merchant Agencies<br />SOON…<br />
  6. 6. Top 20 markets: February data<br />
  7. 7. February Leaderboard<br />Source: Yipit Data (http://yipit.com/data)<br />
  8. 8. Top February Offer<br />Dealfind (Toronto)<br />The Butchers – 69% off<br />$627K revenue<br />11,404 sold<br />Revenue Index: 18.5x<br />Source: Yipit Data (http://yipit.com/data)<br />
  9. 9. Revenue Varies by Category<br />Source: Yipit Data (http://yipit.com/data)<br />
  10. 10. Price for Revenue OR Volume<br />Source: Yipit Data (http://yipit.com/data)<br />
  11. 11. Merchant Economics<br />
  12. 12. Breakage Rate ≤20%<br />Recent data on Groupon is consistent: (i) breakage of 10% (TechCrunch, 8/14/10), and (ii) 20% redemption in month 1 and 15% redemption in month 12 (Chicago Tribune 8/16/10).<br />
  13. 13. Profitable at 19% Retention<br />Assumptions from industry research and Yipitphone survey of SMBs who have completed a Daily Deal in the last 12 months. 80 responses.<br />
  14. 14. High Merchant Satisfaction<br />Data from Yipit phone survey of SMBs who have completed a Daily Deal in the last 12 months. 80 responses.Groupon’sreports repeat interest at 97% (grouponworks.com)<br />
  15. 15. Shifting Ad Spend<br />Data from Yipit phone survey of SMBs who have completed a Daily Deal in the last 12 months. 80 responses.<br />
  16. 16. Thank you<br />
  17. 17. About Yipit<br />“Kayak.com” for Daily Deals<br />Personalized based on where you are and what you like<br />Yipit API<br />>10K Daily Deals per month from 400 Daily Deal services<br />yipit.com/about/api<br />Yipit Data<br />Past offer details and competitive analysis<br />yipit.com/data<br />
  18. 18. Thank You<br />blog.yipit.com<br />@jdmoran<br />

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