Analyzing Top Performing Deal Categories: 2 of 7 in a series

If you want your deals program to be successful, you need to have a deals mix that represents all seven categories (restaurants, retail, travel, recreation, events, beauty and service). This enables your site to appeal to a broad audience and ultimately sell more deals. To give you a better understanding of where you need to focus your efforts, we’re writing a series of articles to breakdown the main categories. We have already analyzed the restaurant, travel, beauty, recreation, service and event categories. Let’s talk retail deals now.

Retail Category Mix

I mentioned during our restaurant category breakdown that you can’t go wrong with a food deal and with food making up 38% of the total revenue for the retail category, it’s true here as well.

Rounding out the top three subcategories within retail are home and clothing with hobby coming in just one percent behind clothing. Seasonality plays a significant role in the purchase process for all of these categories, so both the timing of when you are target businesses within these categories and when you run the deals themselves is crucial. Consider home deals. They’re largely dominated by deals from nurseries and lawn care. The optimal time to target these advertisers is early in the year – before spring. That way you’ve got time to close them and run them throughout spring just as people are thinking about sprucing up their gardens and lawns.

Additionally, the top retail categories all involve products that people buy regularly or at least a few times a year. This makes them perfect additions to seasonal stores, which you should be planning throughout the year, so when talking to retailers, lock them up for multiple deal contracts and you’ll be a step ahead when it comes time to run a new store.

Average Revenue Per Retail Deal

When it comes to average deal performance, food, home and hobby are all neck-in-neck, but clothing falls considerably and is one of the lowest performers of the group. Big box deals from major retailers are certainly appealing, but the likelihood of landing one is slim. The performance data below is based on a very small segment. With retail deals, your best bet is to stick with the top performing categories.

Average Price Point Per Retail Deal

The most striking information is when you take a look at the average price for each deal. Home deals have the second highest price point and also come in second in terms of performance, so consumers are clearly willing to spend a little more to make improvements to their homes. Jewelry, on the other hand, has the highest average price, yet they bring in the least revenue per deal and only makes up 3% of the retail mix. The ineffectiveness of these deals comes from the fact that many of them are setup as only a discount on a portion of the purchase. If you want to go after a jewelry deal, make it simple and keep it product specific.

Final Thoughts

The key to any retail deal is timing. You need to understand what merchants your consumers are frequenting and when they are doing so. Not only will this help you plan ahead and to target the right deals, it will also help you drive revenue considerably.

View the other category breakdowns: restaurant, travel, beauty, recreation, service and event.