Why I Want Google Offers And The Entire Daily Deals Business To Die

Sent to you via Google Reader

Why I Want Google Offers And The Entire Daily Deals Business To Die

Editor’s note:This guest post was written by Rocky Agrawal, an entrepreneur who has worked on local products since 1995.  It is Part II of an earlier analysis of Google Offers. He blogs at reDesign and Tweets @rakeshlobster.

There has been a lot of excitement about the daily deal being the next big thing in online marketing. It’s actually just a clever repackaging of old ideas. Google’s entrance into the space with Google Offers gives the daily deal business a legitimacy it doesn’t deserve.

Where do the big savings come from?

There is very little transparency in the daily deals business.

Google Offers, as a name, especially troubles me. We’re all used to getting free stuff from Google. It provides free email, voicemail, phone calls, photo storage, maps and a lot more. The other day, I was driving using Google Navigation while listening to my music in the cloud on Google’s great new Music service. I also have a sizable collection of Google gear from their Portland giveaways. (Although I missed out on the hats and gloves that I really wanted.) In Portland, Google has spread its money around generously in various events, buying products and services from local merchants.

I fear that customers will think that the generous discount is coming out of Google’s pockets or Internet magic, instead of the merchant’s pockets. It’s much easier to take advantage of a $170 billion company than the shop down the street. When Google was buying beers at Deschutes Brewery in Portland, I went more often. Why not? I was supporting a great local business with Google’s money.

Internet magic has driven down prices in many categories. Priceline’s opaque bidding was sheer brilliance. A couple of weeks ago, I stayed at the Westin in Seattle for $75 a night. The lowest direct rate for that hotel was $179, a savings of 58%. It’s a transaction where everyone benefits: I get a great rate, Priceline gets a small transaction fee and the hotel gets to fill unoccupied inventory without suffering brand dilution.

There is a false perception that Internet magic is why these daily deals are so cheap. Most accounts in the mainstream press tout the great deals, but don’t explain where the savings come from. None of the ...

Sent from my iPhone