People Are Sick of Daily Deals Sites

Both Yelp and Facebook are moving away from coupons

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For a moment there, daily deal sites were all the rage. Now it seems the fad is on its way out, as today Yelp follows Facebook's announcement last week, reducing its presence in the daily deals market, reports Bloomberg. "Yelp will cut its sales staff dedicated to Yelp Deals by half, the company said yesterday." While they don't plan on cutting coupons out completely, these moves look like they signal the decline of the daily deal site frenzy.

There was a daily deal sites bubble. Too many companies, not enough interest. People are sick of it. Getting one or two emails from your daily deal site of choice was nice, but people are over it, continues MacMillan. "52 percent, of U.S. consumers who use daily-deal services say they feel 'overwhelmed' by the number of e-mails they receive about deals on a daily basis, according to a survey conducted earlier this year by PriceGrabber, a division of Experian Plc. About 60 percent of people surveyed said they feel the daily-deal industry is too crowded."

And not only have the deals lost their shine for customers, but participating companies have lost interest too. After participating in deals from one site, merchants get unsolicited calls from others. "They send me e-mails, they call me, they call me again," said Kiebpoli Calnek, who ran a Yelp deal told Macmillan "I told them, 'I’m burnt out from this deal. I have 500 new clients. Why would I want to do another one?" Without demand, these companies just can't make money.

Facebook and Yelp aren't the only ones pulling back. In July, 38 other daily deals sites closed reports MacMillan. But this doesn't mean the end of all coupon sites; there will be winners, explains The Washington Post's Hayley Tsukayama. "What’s likely to happen in the daily deals space, analysts have said, is that a handful of industry leaders will rise to the top, while smaller or niche efforts fade away." As more smaller efforts pull out, the big guys can reclaim the space without overwhelming the demand, explains Reuters's Alistair Barr. "Facebook's exit means Groupon has one less major competitor as it prepares for a $750 million initial public offering later this year."

But maybe even the Groupons of the space are in trouble. "Groupon's unique visits fell 8.9 % to 30.6 million in July, the first month-to-month decline this year, Compete says. Washington, D.C.-based LivingSocial saw an even faster decrease of 28% to 10.6 million unique visitors," reports Chicago Business. There's just daily deal fatigue all-around. As players like Facebook and Yelp pull out, Groupon might reclaim some of the space. But maybe people are experiencing daily deals PTSD, unable to open another quippy Groupon alert ever again.

This article is from the archive of our partner The Wire.