A Guide to Daily Deal Secondary Market Sites
Photo courtesy of bnilson, via Flickr
Last week, I covered some general tips for taking advantage of daily deal sites like Groupon, BuyWithMe, LivingSocial and Restaurants.com–including how to sell a daily deal coupon that you regret buying. Well, it turns out that this secondary market for daily deals sites is exploding. Since daily deal sites projected earnings make them to be a five billion dollar a year industry, and since 20% of daily deals sold go unclaimed, it follows that this remaining 20% is potentially worth a lot of money. These secondary market sites are not just good for those who want to unload coupons they cannot claim. If you missed the deadline for a specific deal, these are great place to look. If you’re flexible and savvy, you can even browse these sites for coupons that are much cheaper than the (already impressive) original deals.
Whether you’re a buyer or a seller, here’s a run down of the daily deal reseller sites:
Lifesta: Lifesta stands out from the pack of daily deal resellers because they were the first to act as a true go-between for sellers and buyers, complete with a way to charge buyers and pay sellers. Lifesta uses Amazon Payments to charge buyers and pay sellers and the purchased deals are delivered as PDFs, via e-mail. Lifesta charges the seller $0.99 plus 8% of the purchase cost. There is no fee for buyers and Lifesta offers a 60-day return policy for deals that are invalid. All users must register on the site to use the service.
Bottom Line: Sellers seem to compensate for the added fees, so it’s hard to get a real steal. Some Groupons, for example, were even marked $5 above what Groupon originally asked. This site is good if you need a specific deal, or if you’re concerned the deal is fraudulent or invalid. Since it’s one of the first, the selection of deals is better than most.
DealsGoRound: DealsGoRound has the honor of being the first site to act as a secondary market for daily deals–at least according to their site. DealsGoRound is also noteworthy for having slick iPhone and Android apps to go along with the service. Like Lifesta, DealsGoRound acts as a transaction platform for daily deals. Rather than Amazon Payments, DealsGoRound processes payments through the PayPal network. The charge is a flat 10% fee for sellers, charged after a purchase has been made, with no fee for buyers. Like Groupon, only an e-mail address is required to register as a buyer.
Bottom Line: DealsGoRound suffers from the same disadvantages as Lifesta, but they have some fun added features to win users. There is a wallet feature, which will keep track of your purchases on daily deal sites, regardless of whether or not you intend to sell them.
TakeMyCoupons: Like DealsGoRound, TakeMyCoupons relies on the PayPal network to process payments. However, TakeMyCoupons has a much more stripped-down (read: kind of ugly) interface and not as many showy features. TakeMyCoupons does have some neat options, though. For one, sellers are permitted to post daily deals in a variety of formats, including “auction” and “best offer.” Also, TakeMyCoupons charges a listing fee, rather than a percentage of the total sale. These fees are never more than a couple of dollars.
Bottom Line: The listing fees seem to scare away potential sellers who are probably afraid to sink more than the cost of the original deal, so content on this site is sparse. Users can search deals without registering, but the search interface is a little complicated and buggy. This site is not recommended.
SellMyDeal: SellMyDeal doesn’t use PayPal or Amazon, instead opting to charge buyers directly and deposit money right into sellers’ bank accounts. Sellers get their payment 14 days after the sale. Why? Because the window for buyers to return an invalid deal is–you guessed it–exactly 14 days. SellMyDeal charges 10% the cost of sale to sellers. The site layout is simple and functional. On the plus side, SellMyDeal is clear about how many vouchers for a particular deal are on sale. in the minus column, it’s impossible to search for specific keywords.
Bottom Line: For a 10% sellers’ fee, buyers would be right to expect a greater return window than 14 days. (Compare this to Lifesta’s 60-day policy.) However, the selection on this site seems pretty decent and the prices are comparable to Lifesta and DealsGoRound. It’s worth keeping in rotation if you can’t find “The Groupon that Got Away” anyplace else.
CityPockets: In the same vein as DealsGoRound, CityPockets aims to be more than a simple daily deal reselling site–its goal is to be a kind of aggregator for content from Groupon, LivingSocial and the rest. After you sign up and enter your credentials for those daily deals sites, CityPocket will display them in one place and even send automatic reminders when the expiration dates approach. If you want to sell a deal, CityPockets charges the same rate as Lifesta: $1 plus 8%. CityPockets uses PayPal.
Bottom Line: While there are good deals to be had on CityPockets, the “marketplace” tab where deals are sold seems a bit like an afterthought. CityPockets mostly wants you to use it to find upcoming deals, map them out and organize them. The prices are not any lower and the selection is not any greater than anywhere else. It’s worth using mostly if you’re into the main features.
Dealigee: Dealigee shows a lot of promise, but unfortunately very few can take advantage of it at the moment. Here’s the bad news first: Dealigee only posts listings for deals in New York, Chicago, and San Francisco. If you live in one of those cities, it’s a solid service. Dealigee uses PayPal, but does not charge any fees for posting or selling deals. Somehow, Dealigee still offers a 30-day money-back guarantee for buyers. The site even has a “make offer” feature, if you want to haggle with a seller. Another cool feature: users can log in with Facebook instead of creating a new account with the service.
Bottom Line: The selection is of course small–even if you live within one of the three cities where this site is active. But the features are good enough that the site is worth keeping an eye on, in case it opens up in your city.
CoupRecoup: At the time of writing, CoupRecoup is the undisputed king of the daily deal secondary market. Unlike the above resellers, CoupRecoup works like Craigslist. Anyone is free to post a deal, and anyone is free to buy or make an offer, no charge whatsoever. There’s no in-house payment system, but PayPal is recommended. There’s also no in-house buyer protection. If a deal turns out to be a scam, the best CoupRecoup can do is blacklist the seller and offer to help with the police report. But thankfully this scenario seems to be pretty uncommon. Users can browse deals without registering, and sellers can post deals with only a link to the original, an asking price, and an e-mail address. It all couldn’t be easier.
Bottom Line: Thanks to the ease of use, the selection on CoupRecoup rivals that of any other site. Sellers have nothing to lose by posting, and since they have no additional fee to worry about, the prices are on average lower than the ones you’d find elsewhere. If you’re looking to buy or sell, this site is your best bet. Just be sure to exercise some caution when buying. Just like on Craigslist, it’s best if the seller has done some business before, or if you can get them to give you an address or phone number, just in case.
It’s worth mentioning that Groupon offers refunds for any deals you decide you don’t want–as long as they are not expired. This means if you’re a seller who’s holding a deal that probably wouldn’t sell with a mark-up, it would probably be wise just to return it to Groupon. It also means we can expect fewer Groupon deals on these secondary market sites in the future.
Have your own favorite secondary market daily deal site? Any tips on how to best take advantage of them? Please share in the comments.