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Lip Service Helps Daily Deals Deliver for Small Businesses

Lip Service Helps Daily Deals Deliver for Small Businesses . / Credit: Word-of-mouth image via Shutterstock

Word of mouth is the engine driving successful daily deal campaigns for small businesses, a new survey found. Recommendations from friends and family make consumers more likely to purchase a deal from an unfamiliar small business. But don't count on daily deals making new friends for life for your business: The survey of 1,433 consumers also confirmed that deal buyers are notoriously fickle.

Half the respondents said they are likely to subscribe to a deal from a small local business if the deal is recommended by friends or family, according to Constant Contact, an engagement marketingfirm that sponsored the survey and whose products include SaveLocal, a tool for creating and selling local deals.

Deal buyers are also generous in sharing their opinions, the survey found. More than half (54 percent) said they will share a deal if they think it's great, and 45 percent said they will share if they think their friends will like the deal.

[5 Reasons Consumers Use Daily Deals]

The deals most commonly shared are for restaurants (65 percent), entertainment (48 percent) and food and groceries (36 percent). More than twice as many consumers share deals via email than on social networks such as Facebook, the survey found.

But just because deal buyers sample your wares once, that doesn't ensure their faithfulness. For nearly 60 percent of customers, even a good daily deal experience doesn't automatically equate with loyalty.

Fickleness notwithstanding, nearly the same percentage of deal subscribers believe that daily deals are an effective way for businesses to attract new customers.

"Two of the more important findings in this research were that word of mouthis key for the success of a deal and that personal endorsements drive deal purchases," said Dave Gilbertson, general manager of SaveLocal. "Half of the survey respondents said they are more likely to purchase a deal if it is recommended to them by friends or family – and that’s why merchants are more than happy to reward people who recommend them and share their deals on social networks or through email."

Reach BusinessNewsDaily senior writer Ned Smith at nsmith@techmedianetwork.com. Follow him on Twitter @nedbsmith.We're also on Facebook & Google+.

Ned Smith
Ned Smith

Ned was senior writer at Sweeney Vesty, an international consulting firm, and was Vice President of communications for iQuest Analytics. Before that, he has been a web editor and managed the Internet and intranet sites for Citizens Communications. He began his journalism career as a police reporter with the Roanoke (Va.) Times, and was managing editor of American Way magazine and senior editor of Us. He was a Captain in the U.S. Air Force and has a masters in journalism from the University of Arizona.

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