What happened to all the daily deal websites?

by Peter Griffin / 15 September, 2017
RelatedArticlesModule - Daily Deal

Photo/Getty Images

When the buzz around daily deal sites ended, some companies folded, but others have flourished.

Five years ago, my morning ritual involved turning on my smartphone and scanning daily deal websites. I’d bounce between Treat Me, GrabOne and Groupon to see who had the best deals on restaurant meals or weekend getaway packages. Many of us were doing it, browsing for digital coupons.

There was always a time limit on these sites. You had to buy now or risk missing out.

Then, abruptly, the buzz around daily deals and group-buying sites ended. The bubble burst and a number of players shut down. Analysts suggest it was because the businesses featuring their cut-price products and services on these sites realised the deals didn’t encourage customer loyalty.

I always felt like a half-priced diner going out on a Treat Me coupon, because often I was treated like one. The restaurants were usually just trying to fill seats on slow nights. It was, more often than not, a patchy experience.

The daily deal sites are still there, but the scene has changed. GrabOne, the best known, has tried to reinvent itself as an online marketplace, more akin to Trade Me, but has struggled. Its owner, New Zealand Herald publisher NZME, noted in its financial statements recently that GrabOne’s revenues remained “under pressure” as it moved away from being a daily deal site.

Trade Me sold Treat Me in 2013 after dabbling in daily deals for a couple of years. Big US players Groupon and Social Living had a crack at the local market too, with little success. Groupon acquired Social Living’s remains last year, paying zero dollars for it – the ultimate cut-price deal.

But some daily deal survivors are quietly doing very well. Waikato-based 1-day.co.nz was among the first of the daily deal sites to launch in 2007. Its timing was perfect, with economic recession looming.

It has just sold its 10 millionth product. One of its bestselling items is a steam mop.

Electronics and clothes are its two biggest product categories, although managing director Greg Bell says furniture is a fast-growing category. 1-day.co.nz had a foray into the experience-based deals that GrabOne and Treat Me specialise in but quickly retreated as the owners realised they had little control over the quality of experiences on offer.

They refocused on physical products that they could touch and test themselves. 1-day began by featuring three products a day, starting the clock at noon and giving website visitors 24 hours to buy before the deal expired.

“You couldn’t get away with that now,” says Bell. “We feature 300 products every day. We are a shop that changes our shelves every day.”

The daily deal sites that have survived are now squarely competing with Trade Me, the biggest online retailer of them all, as well as Amazon, eBay and Chinese marketplace Alibaba. These sites have millions of products on offer, sharp deals and, in many cases, an advantage over local e-tailers, as buyers importing goods into New Zealand don’t have to pay GST if the value of the product is less than $400.

It’s a recipe that has worked for a decade – 1-day sold $54 million of goods last year and employs more than 100 people. Bell has faith in his buyers, who are scouring the world for products and constantly haggling with suppliers to get the best deal.

Bell thinks 1-day is well placed, even as Amazon prepares to enter Australia, complete with massive warehouses for its inventory. “We can ship our products faster, we are local, with live chat and customer service,” he says. “We have a few advantages that will hopefully give us that edge in future.”

Five daily deal sites

  1. 1-day.co.nz – Just turned 10 and still offering sharp deals valid for 24 hours on three products, but hundreds more are featured in its online store.
  2. Grabaseat.co.nz – Air New Zealand’s popular discount flight service offers cut-price fares but with limitations on when you can travel.
  3. Mightyape.co.nz – Offers six deals at noon every day; strong on books, CDs and DVDs.
  4. Onedollar.co.nz – One item, one dollar, every day. It may not be what you want, but it costs only a buck.
  5. Vinomofo.co.nz – Australian player totally focused on discounted wine deals – for a limited time.

This article was first published in the August 5, 2017 issue of the New Zealand Listener.


Green MP Eugenie Sage accused of ministerial interference
88686 2018-03-23 07:28:31Z Politics

Green MP Eugenie Sage accused of ministerial inter…

by Benedict Collins

A Green Party MP has been accused of ministerial interference and sticking her nose into staff matters at an independent authority.

Read more
The summer the power went out in Auckland
88683 2018-03-23 06:31:22Z History

The summer the power went out in Auckland

by Justin Gregory

Friday, February 20th. 5.30pm. The last remaining major cable blows up in Mercury Energy's faces. The 1998 Auckland power crisis has begun.

Read more
Air New Zealand stoush highlights pitfalls for coalition government
88681 2018-03-23 06:11:39Z Politics

Air New Zealand stoush highlights pitfalls for coa…

by Jane Patterson

The face-off between the Minister Shane Jones and Air NZ has given voters a peek into the pitfalls that may lie ahead for the coalition government.

Read more
Johann Hari's search to uncover the real causes of depression
88186 2018-03-23 00:00:00Z Social issues

Johann Hari's search to uncover the real causes of…

by Louise Chunn

Stalked by depression for 20 years, Johann Hari couldn’t find the pharmaceutical relief doctors promised. He began asking why.

Read more
Are antidepressant pills really effective?
88211 2018-03-23 00:00:00Z Psychology

Are antidepressant pills really effective?

by Marc Wilson

Johann Hari is right about some things, but effective depression treatment means casting a wide net.

Read more
Win a double pass to Dancing with Mozart thanks to the Royal New Zealand Ballet!
88313 2018-03-23 00:00:00Z Win

Win a double pass to Dancing with Mozart thanks to…

by The Listener

Great music inspires great dance, as the Royal New Zealand Ballet brings works by choreographic titans Jiří Kylián and George Balanchine to NZ.

Read more
What to see, eat and do at Pasifika Festival 2018
88671 2018-03-22 15:44:53Z Where to go in Auckland

What to see, eat and do at Pasifika Festival 2018

by Vomle Springford

The largest Pacific Island cultural festival in the world takes place this weekend at Western Springs Park.

Read more
On the misguided crusade to make bike helmets optional
88652 2018-03-22 11:18:12Z Social issues

On the misguided crusade to make bike helmets opti…

by The Listener

At a time when other sports, notably rugby, are prioritising head-injury prevention, easing up on bicycle helmets is perverse.

Read more