Clearly, Canadians love a good deal.
According to a report by Dallas-based marketing firm Epsilon, Canadians are more plugged into the so-called group deal or deal of the day website trend than Americans, and are willing to live with a flood of promotional emails in exchange for cut-rate deals.
About 53% of surveyed Canadians said they were familiar with at least one group deal website–such as the Chicago-based originator Groupon or homegrown competitors like Dealfind, TeamBuy and WagJag–while only 39% of Americans knew of the sites.
They typically offer discounts of 50% off or greater to be redeemed at local businesses, usually restaurants and bars, shops and spas or salons.
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About 42% of the Canadians familiar with group buy sites said they signed up to receive daily offers via email, compared to 34% of U.S. respondents, 9% said they buy a discount voucher every few weeks, 2% buy weekly, and 1% said they buy something every day.
The survey results weren’t surprising to consultant Albert Bitton, who follows the industry and runs the blog Group Buying Canada. He said previous studies have suggested that Canadians are also more engaged in loyalty programs and other money-saving promotions, so it makes sense that they’re into daily deal sites too.
“Canadians have always been known as more conservative buyers,” Bitton said.
Bitton said the Canadian group buy market is about a year behind the American industry, with more innovations having already been launched south of the border.
“Just now are daily deals sites coming up that have niche categories, such as for women or specifically for families or travel,” he said.
One trend that’s already beginning to catch on is a move toward offering discounted products alongside the traditional local deals.
“Daily deal companies–especially large ones–have to chase the revenue and in order to chase the revenue they have to become e-commerce sites,” Bitton said.
But the first sites to offer those kinds of product deals have got off to a somewhat shaky start.
Dealfind had problems after it offered some low-priced made-in-China tablets that customers found subpar.
“As time goes by we get into new aspects of the business and we’re selling different products and services. And what happens over time is, unfortunately, we’ll run a deal with a merchant who doesn’t fulfil their side of things,” said Gary Lipovetsky, co-founder of Dealfind, which launched in Canada in 2010.
“We have actually stopped running tablets and other electronics over the last few months and the reason we did that is because we didn’t want to repeat the same mistake. Right now we’re in the process of securing new relationships with very credible, national suppliers of electronics.”
It’s difficult to offer products made by top-tier electronics brands because consumers expect deep discounts, he added.
“The whole premise of the site is to get people deals and on branded electronics there’s very little margin,” he said.
