Today, at BIA/Kelsey’s “Deals 3D” conference in San Francisco, Dan Visnick, VP of Marketing at The Dealmap, shared some insights into the current landscape of daily deals. Dealmap, a repository of daily deals collected from over 350 sources, allows users to view local deals in map form, along with reviews and pertinent information — on the Web and on mobile. Both through its API and its DealExchange service, which allows businesses to easily distribute deals across various channels, The Dealmap is enabling new entrants to the space to quickly populate their applications with a bulk of deals.
Through the data the company has been collecting via DealExchange and beyond, Visnick said that it has become very clear that the industry is still very top heavy, as 80 percent of deals are offered by as few as 20 sources. Inventory, then, is still largely controlled by the top deal players, with nearly 70 percent of inventory controlled by 10 sources, and 40 percent controlled by the top two. I assume, though Visnick did not say specifically, that those two sites are none other than Groupon and Living Social.
Among the top sites, the average inventory for each market, Visnick said, is 6.25 per day — compared to the median inventory per day, which is 1.29. Thus, it seems that discrepancy in inventory between the bigs and the startups is still fairly significant, with half of the 350-plus deals sites only offering 1 to 2 deals per day.
And when it comes to national distribution, the majority of daily deals sites are in less than 10 big markets. Just under 20 percent of daily deals players are in a single market, while 69 percent of sites are in between 2 and 9 markets, meaning that nearly 90 percent of sites are in less than 10 markets. Of course, as Laura Hazard Owen of paidContent point out, this will likely change in the near future as the web giants like Facebook (which just partnered with AmEx to create a daily deals platform) and Google — those with established national networks — roll out their own versions.
In other notable trends, Visnick said that mobile is becoming a much bigger factor in the space, sneaking up to 32 percent of the deal space, compared to the web at 61 percent, and email at 2 percent. The mobile deals space has really started to heat up of late, with AT&T jumping into the daily deal game yesterday, offering daily deals through YP.com. Foursquare also announced last week that it would be distributing AT&T’s Deal of The Day to its 10 million+ users.
Also worth mentioning: BI noted that venture capital firms have invested $1.6 billion in capital in daily deals sites thus far in 2011. While the number of daily deals sites has quintupled in the last year, only 22 companies have received funding in the last year. And, of the 270-some companies tracked by Daily Deal Media, only 32 have received funding from “the investor community”. Again, the top ten deals sites are the ones growing fat on VC dollars (Groupon, Living Social), while the rest are fighting for table scraps.
Yet, the most interesting trend of all cited by Visnick would have to be that 5 percent of all daily deals sites are now using some form of animal name. DealChicken, Rhino Deals, TownHog, Deal Stork, Rabbit Pack, and Rumba Fish are among the animal-related sites that come to mind. It seems that there’s just something about an animal that says “discount”. I’ll leave it up to you, reader, to determine the significance — if any — of this juicy trend.