July 29, 2010, 4:17 PM

Personalization comes to daily deals

Groupon today announced it is rolling out tailored offers. Will more daily deal sites follow?

Well, it seems like our blogs are having an influence.

Last week I posted a blog entry noting that the one-size-fits-all approach that characterizes many daily deal sites has led me to unsubscribe from their e-mail lists. And today Groupon launched a service that tailors each subscriber’s stream of daily deals to their personal preferences and buying history.

Coincidence? Obviously. But the potential effect on daily deal sites could be widespread. 

Personalization is rapidly spreadinga survey by Patricia Seybold Group and the Institut Telecom Paris conducted earlier this year of 100 U.S. and European companies found that every respondent who didn’t already have a product recommendation engine in place was planning to deploy one by next year.

The reason is that retailers like skateboard and apparel retailer West49 are finding that customizing content—both in e-mails and on their sites—can produce dramatic results. In the case of West49, the retailer increased its e-mail click-through rate from an average of about 10% to more than 30% within only a few months.

Similarly Build.com improved its conversion rate by 23.1% within a month of adding personalized recommendations for similar and complementary products to its product pages.

If daily deal sites can find a way to tailor promotions to the consumers receiving them, these sites could be a force to be reckoned with.

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