Research Shows Small Business Attracted to Online Marketing but Looking for Better Options to Group Discount Model
CentrSource Launches the Online Marketing Alternative with Emphasis on Flexibility and Choice for Small Business
(firmenpresse) - TORONTO, ONTARIO -- (Marketwire) -- 01/13/12 -- Canadian small business has shown an early attraction to online group discount platforms according to research by Harris Decima conducted on behalf of CentrSource. However the research shows that small business owners want more flexible marketing platforms that provide more than the one time "deep discount strategy" for building their business. The research(1) conducted online between August/September 2011 and shows that the market is still seeking a better alternative to what is currently available. CentrSource, who has launched an updated version of their multi-faceted online marketing platform, has created an alternative to group discount that is well positioned to specifically address the small business need for flexibility, choice and control in an online marketing.
"The research shows that the core needs of Small Business owners who want customized messaging, the ability to collect contact info, and a free web listing all delivered in a pay-for-performance model are not getting what they want from group discount models," said Megan Tam, Vice President, Harris Decima. "It leaves the door open for new market entrants to address that gap by offering business owners significant control on pricing, timing and ultimately provide an option that better serves the needs of small business."
CentrSource differs significantly from Group Discount platforms because it does not have a "one size fits all" approach to business marketing. CentrSource allows businesses to connect and motivate customers on their own terms by deciding what they want to offer, when and where they want to offer it and how much money they choose to spend on the campaign. The CentrSource platform enables full flexibility on the type of offer they choose and the frequency of the offer. In addition, the focus of the target market can be as big as the full national network or as focused as a specific neighbourhood. It's an approach that the CentrSource founder describes as truly sustainable and a better choice for Canadian small business and the consumers they do business with.
"To create a real and valuable online marketplace, both consumers and businesses need to have substantial choice and flexibility," said Bob Westrope, Founder of CentrSource. "CentrSource was created with that in mind. We recognize that business owners know best what type of offer works for them and it varies from business to business. CentrSource allows business to make the type of offer they want on their own terms. The result is many offers from many businesses and much more choice for consumers."
In the largest cities they serve Group Discount players such as Groupon, limit deals to between two and four offers per day. That translates into a maximum of 1,500 offers per year, per market. CentrSource which has only just launched in Canada already has more than 2,000,000 offers online including multiple offers from many individual businesses.
As well, Group Discount models routinely offer discounts ranging 50-95 percent off at restaurants, spas, clothing stores and similar small business operations. The remaining revenue is then split equally with the Group Discount platform, leaving the retailer with very little margin on the sales generated. CentrSource not only provides many more alternatives to the Group Discount model but for those who feel the need to utilize a Group Discount strategy, CentrSource provides a competitive solution but only takes a 15 percent share of the revenue generated from sales. It's just one more example of why the founder considers CentrSource a better deal for business.
"From our perspective a sustainable platform has to be an adaptable platform and CentrSource is therefore a better bet for Canadian small businesses because it is ultimately more cost effective and provides real control to the business creating the offer," said Westrope. "It's the type of approach that will allow business to use it again and again creating a firm foundation for an online market that holds real long term sustainable value for consumers who are then empowered by the choice and variety they find on CentrSource."
The Harris Decima research conducted on behalf of CentrSource and CentrSource Strategic Alliance Partner, Canada Post, showed that consumers in Canada are also looking for a better online experience than is currently offered by the Group Discount model. 52 percent of consumer respondents indicated they were neutral on the question of satisfaction with online group discount while 15 percent indicated they were not at all satisfied.
Harris Decima reports that a key finding among consumers interviewed was the need for sites to be "free, have relevant content, be easy to use, unique and ideally local". Compared to what is currently available, consumers want to see deals that are more unique and relevant to where they live and to see more of them.
By creating a more open market platform CentrSource is building an online market that has the attractive qualities for business to be more local and more active online and in doing so create real choice for consumers.
Research published in the United States, where Group Discount platforms first launched, has shown that business owners are struggling to find sustainable value in Group Discount models and this is raising questions about the long term viability of these platforms. A study conducted by Byers, Mitzenmacher and Zervas from Boston and Harvard Universities in 2011 noted that "Groupon sales and revenue per deal in the 20 cities monitored had peaked in February 2011 have trended steadily downward since."
Industry commentators such as Rocky Agrawal have strong criticized group discount platforms because they simply do not work for small business owners.
"A big reason that local advertising hadn't taken off before Groupon was that the cost of sales was too high compared with the revenues that could be generated by online banners and search advertising. The daily deals "solution" is to raise the cost of local advertising to the point where you can sustain a sales force. It takes Internet advertising and makes it more expensive, less trackable and less targeted."
About CentrSource
CentrSource is a digital marketplace that helps people find the best value on goods and services available from a wide range of local, national and on-line businesses. We connect people with offers that matter to them through a new network of well-known and emerging media.
Strategically aligned with Canada Post, one of Canada's most trusted and respected organizations, CentrSource allows businesses of all types and sizes to generate sales and qualified leads in keeping with their needs and budgets. Created in Canada, CentrSource is the preferred choice for local business who use the service to profitably engage customers when, where and how they choose. For more details visit .
(1) Research was conducted online by Harris Decima on behalf of CentrSource utilizing a proprietary online Harris/Decima panel. A total of 1,307 surveys with consumers were completed between August 28th and September 6, 2011. A total of 573 surveys with Small and Medium Business respondents were completed between August 29th and September 7, 2011. As these were non-probability samples, MRIA precludes any estimations of the margins of error.
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Datum: 13.01.2012 - 13:30 Uhr
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