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Friday, Feb. 12, 2010 at 9:30 am

Timed Sale Websites & The X Factor of Conversion

By Natalie Hart
February 12th, 2010

groupon

Recently, I moved to Boston and began the search for the perfect gym.  I got recommendations from friends, did some research online, and even visited a few in the area to discuss membership options.  But, my instincts told me that if I could just wait one more week, some amazing deal would come along.

Last week that deal appeared in my inbox from Groupon; $24 for 24 day passes, a $480 value, saving me 95%! I couldn’t have been happier.

Sites such as Woot.com, Amazon’s Gold Box, Groupon.com, BeyondTheRack.comRuelala.com and BillionDollarBabes.com have been appearing in recent years in the online retail space and I have to say, my friends and I are in love! We often share sites, tell each other about deals, and spread the good word-of-mouth (and email) to just about anyone who will listen.

Sites such as these offer promotional sales for clothing brands, restaurants, gyms, hotels,  spas, wine, vacations, and just about anything else you can imagine. The key is that they are timed so that the deal expires after a set duration.  And, after some thought and discussion, I’ve decided that the expiration factor (The X Factor) is key.  It’s a new twist on the “sense of urgency” sales and marketing tactic that’s been around for a very long time.

Example: I have this “friend” who considers herself a fairly frugal shopper, and never would purchase a pair of $100 boots in a store, or even online from a site like Zappos, but when she found a pair of $475 boots on sale for $108 on beyondtherack.com, she couldn’t help herself! She easily forked over her credit card information in fear of “losing the deal.”

“Persuasive fear” has emerged in this space and visitors are rewarded for their quick-to-convert action.  Never before have I heard of so many Early Stage visitors going straight to Late Stage in a matter of moments! I’m excited see how these sites continue to change the online retail space and morph the buying stages into a single-stage process. What I wouldn’t give to have a look at their analytics!

The question is, do these types of “buy now or lose out” sites pose a legitimate threat to mainstream retail big-brand eCommerce sites? Or, will they always be niche business that only appeals to spontaneous deal hunters? Sound off, please :)

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Comments (74)

  1. I have a friend who owns a small store. She had a dress on sale for $100. One month passed that dress is still hanging in the store. She raised the price to $999 with a note on the tag saying “Last one”. It was sold within one week!

    From time to time we see “buy one get one free” promotions in stores. People think that they get one for free but they actually pay double price for the first item. We have a Dish Network store. With Dish Network offers, normally local channels are charged for $5 per month. If we tell customers you have to pai $5 additional to get local channels, people think we over charge them $5. If we tell them that they can save $5 per month if they do not need local channels people are happy because they can save $5 per month. It is interesting.

  2. Deals are what we all long for, I hope you find a good gym!

  3. We can’t be sure, it is just a matter off business selling strategies. But I think currently more and more shops have this kind of strategy: “buy now or lose out”, especially for end of seasons sales.
    This strategy also works if the shopper is a product aggregation.

  4. I think they will always be niche business that only appeal to spontaneous deal hunters

  5. I agree with dish network. We all look for great deals, if we see some great deal in a shop somewhere, we automatically assume it’s correct and buy it straight away. Strange human nature.

  6. Ah..how many times have I been sucked in by the “buy now or it’s gone” deals! I am an avid deal shopper…sometimes when I don’t even need the product. I think it’s hardwired into our brains!

  7. Great info!I checked out the website and it has gotten my attention! Thanks for the post.

  8. thanks for info I also often get an email about the coupon for every purchase of a discount. is valid not only to spend what a marketing idea to promote her website

  9. Yes, time limited offers definitely also trigger the quick emotional response to get them to hit the buy now button. I think it’s definitely an edge, and reminds me to implement it some more. Thanks!

  10. Nice article. I’m going to side with the “buy now or lose out” camp.

    If the price is good enough, you can make anyone a customer!

  11. Thanks for sharing about the websites. People love deals, cheap, discount and most especially, free!!! So, it’s really no wonder that this kind of sites can really convert visitors to customers that quickly and easily. However, like forex, I also think they will always be niche business that only appeal to spontaneous deal hunters.

  12. The Cisco team has been working closely with Microsoft to prepare for the late 2009 introduction of Windows 7 in order to ensure continued network connectivity and device discovery for the Linksys by Cisco line of products.

  13. If we see some great deal in a shop somewhere, we automatically assume it’s correct and buy it straight away.

  14. But I think currently more and more shops have this kind of strategy: “buy now or lose out”, especially for end of seasons sales.

  15. What seems like getting a good gym deal may just be a sales ploy.

  16. I have fallen for many of these before but because of my crunch and articles like these, I became smarter

  17. I think that sites that only serve timed discounts etc will never be mainstream. But every site that wants to maximize profits should implement some kind of daily or timed super saver type deal, to keep people interested all the time and buying related stuff (cross selling hard).

  18. Nice article. I’m going to side with the “buy now or lose out” camp.

  19. [...] by noreply@blogger.com (Charlie) Look at the original post. Thanks to [...]

  20. I think Amazon is more expensive than other ones.

  21. Thanks for the post!I checked out the website and it has gotten my attention!very nice info for me to get info.

  22. These sites are certainly gaining a following. Look towards all of the sample sites: Ruelala!, Gilt Groupe, etc. The timer on these sample sites really pushes individuals to press the add to cart button.

  23. Congratulations on that spa deal. For the timer effect, people afraid of losing a deal. It does make sense as long as the offers stay good. For shoes if they really cost 398$ in store and you get them for 99$ thats a smart deal. Or for tech gadgets where you can clearly see it´s a bargain. But often enough it might not be that deal. Unlike the spa deal of course, I am jealous I want it too!

  24. This is a good article, learn much from it, i sell dreambox satellite receiver in my online shop, my conversion rate is not very hight, i really need to improve it.

  25. So true! My friend just made a ton of money on an online auction site he sold. The whole principle being giving people insane deals that they love to brag about anyways.

  26. you are right , and this is a known Market Method , but can’t really determine who and when it was used ! .

  27. I think it lies in the human psyche to fall into these traps, but i don’t see it as a real threat to the traditional stores.

  28. @ How to

    We have all been taken advantage of before. That’s why we are here!

  29. Yeah, this is called marketing! I dont know what is wrong with this approach…you can face it everywhere now.

  30. @ Fallas

    You don’t see online business as a threat to traditional stores? Are you serious! Do you know how many physical businesses are put out of business every day because they can’t compete with online stores with little to no overhead and rock bottom prices?

  31. my friends and I are in love!”

    Must consider on this article… look informative..

  32. nice share. People think that they get one for free but they actually pay double price for the first item. We have a Dish Network store

  33. For shoes if they really cost 398$ in store and you get them for 99$ thats a smart deal. Or for tech gadgets where you can clearly see it´s a bargain.

  34. every site that wants to maximize profits should implement some kind of daily or timed super saver type deal

  35. It all depends on the business strategy that attracts more customers

  36. Time limited offers trigger the emotional response to get the customer adding product to cart without looking for alternate offers.

  37. Whilst I don’t disagree discounts are wonderful, though I sense that we are living and buying in a world of discounts where the original price is really unknown. Is this the retailers strategy? I prefer to have a clear knowledge of the base price and then negotiate as done in Asian countries.

  38. Hi this information helped me a lot in analyzing my conversion success. Cheers! :)

  39. I have seen many using that tactics. It is make visitors feel that deal is only for a short period and make us compelled to act. And sometimes it do work.

  40. @shpallje falas

    i disagree with you, yes it is a treat for traditional store owners those who are marketing online. People nowadays seems tired of going to physical stores and do shopping they preferred it online. Its fast and easy.

  41. Thanks for the post!I checked out the website and it has gotten my attention!very nice info for me to get info.
    Cr4zY | İnterAktif Web Günlüğü

  42. Great info!I checked out the website and it has gotten my attention! Thanks for the post.

  43. ‘Buy now or loose out’ sites effectively target an extremely powerful call to action that most definately has the edge over maistream ecommerce sights.

  44. Yeah, this is called marketing! I dont know what is wrong with this approach…you can face it everywhere now.

  45. The Cisco team has been working closely with Microsoft to prepare for the late 2009 introduction of Windows 7 in order to ensure continued network connectivity and device discovery for the Linksys by Cisco line of products.

  46. Hi, this blog is informative. This helps me a lot. I’m looking forward for your success! :)

  47. I think these sites will stay niche – or at least the appeal will stay with the younger demographic. I just bought something from Groupon.com a few weeks ago. I can guarantee you I would still be considering the purchase if there had been no expiration date to the deal.

  48. Nice article. I’m going to side with the “buy now or lose out” camp.

  49. I’m looking to develop an ecommerce site, but I have zero HTML Skills. Does anyone know of any good Ecommerce development sites that offer templates, and all that fun stuff?

  50. Impulsive buying, or as you framed “buy now or miss out” buying will never become redundant. The traditional methods have been transferred online. This is not a different approach, rather an adaptation to allow for all types of online shopping. The approach on line is now beginning to take shape and consumers are working out where and who they shop with. For me as a consumer and business operator, I sense that in order for the business to succeed online shopping must be available. This does not need to replace the department store, or the physical outlet. However, as with some physical outlets they come and go, move around the country. We will see this on the internet too. The strategy for the business will now include their online marketing and sales.

  51. Conversions is what we require from our traffic, that is the long and the short of it. Squeezing people into buying in / paying straight away is even the subject of a specific WordPress Theme, aptly named Squeeze Theme, with the sole intent and purpose being to convert traffic into conversions. We haven’t even begun to see the tip of this particular iceberg.

  52. I think this tactic is so powerful that you see so much attention to the product launch that is a one-time offer. Buy it now before we take it off the market. People are making so much on the launch, they are neglecting the additional sales they could make with a consistent campaign. I’m not sure I agree with the strategy, but it clearly is powerful.

  53. I think “buy now or lose out” sites will only take over the established ecommerce stores or websites if they manage to get a better (higher) webpresence in the search engines than the established sites.

  54. Nearly all IM sites I have visited have a OTO (one time offer) that is time sensitive, but I have not seen many ecommerce sites doing it. I think in many situations it does cause the buyer to make a quick decision on whether they will purchase or not.

  55. I believe it will probably be a mixure of both, although would firmly believe the Niche searches would increase, dependant on location, eg: London UK = 7million – Liverpool = 1mill approx

  56. You often find these kind of marketing tactics on product launch, end seasons sales or during lead’s follow-up. This is mostly good for the business as well as customers.

  57. i never look for more traffic rather i will always try to improve my conversions.
    @karzanik
    Yup you can check out odesk or other outsourcing websites. cheaper is some times better.

  58. I think these sites will stay niche – or at least the appeal will stay with the younger demographic. I just bought something from Groupon.com a few weeks ago. I can guarantee you I would still be considering the purchase if there had been no expiration date to the deal.

  59. But every site that wants to maximize profits should implement some kind of daily or timed super saver type deal, to keep people interested all the time and buying related stuff

  60. I think “buy now or lose out” sites will only take over the established ecommerce stores or websites if they manage to get a better (higher) webpresence in the search engines than the established sites.

  61. No big deal (sorry about the pun). This is just sensible marketing that helps promote a business or brand. Get a few people excited with a great (limited) offer and then watch the word spread as your product or services touches people in the right way.

  62. Well, if you really saved 95%, I gotta say that’s a pretty good deal. I pay around 50 bucks for my gym membership. It’s not 5 stars though…

    Answering your question, I believe these websites pose no risk to mainstream eCommerce sites, unless they get a better webpresence on the search engines or go extremely viral.

    Pedro.

  63. I guess the buy now sites and the big brand eCommerce sites have their own place and importance on the internet. It is completely on the discretion of the customers where they would like to buy from. It’s a different type of traffic for these different websites.

  64. A serious background check is the first thing to do. But, of course, many people catch on those “great offers”

  65. Online Shopping sector is growing very rapidly and we see lots of eCommerce websites launching day by day. They provide lots of interesting deals, discounts on the products. So a customer has a wide opportunity to buy the items which they want and Should check the expiration of the deal before buying..

  66. @karzanik
    Yup you can check out odesk or other outsourcing websites. cheaper is some times better.

  67. @SEO- thats true, but more websites just means its much harder to convert the visitors to customers. People are getting more picky the more choises they get.

  68. These sites are certainly gaining a following.

  69. In my view It’s really no wonder that this kind of sites can really convert visitors to customers that quickly and easily. However, like forex, I also think they will always be niche business that only appeal to spontaneous deal hunters, anyways thanks for the share.

  70. I agree. The expiration date as a sense of urgency has been around for a long time in traditional, direct mail but it’s proven to be huge online. That coupled with the social aspect of sites like Groupon have made an enormous impact for businesses. Living Social selling 1,301,296 Amazon $10 for $20′s is proof of the power!

  71. I totally agree, and as a small business owner the sence of urgancy is a tactic i have been using for some time. It does work. Not allways but it does work. When people call requesting a product i know from my own stats that 90% of them will buy, the question is when. I get calls from customers that i talked to 6 months ago that are not ready to put $ in my hands lol. Since i started using the urgency factor on a sale it has increased how soon they buy if not instantly.

  72. I think “buy now or lose out” sites will only take over the established ecommerce stores or websites if they manage to get a better (higher) webpresence in the search engines than the established sites.

  73. I think “buy now or lose out” sites will only take over the established ecommerce stores or websites if they manage to get a better (higher) webpresence in the search engines than the established sites.

  74. You often find these kind of marketing tactics on product launch, end seasons sales or during lead’s follow-up. This is mostly good for the business as well as customers.

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Natalie is a Persuasion Analyst with FutureNow.

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