Consumer Spending on Deal-a-Day Offers Likely to Reach $3.9B in U.S.
by 2015, According to BIA/Kelsey
Analysts will highlight details from new forecast during a Daily
Deals SuperForum at Interactive Local Media East, March 21-23 in Boston;
LivingSocial CEO Tim O’Shaughnessy to keynote
CHANTILLY, Va. (March 3, 2011) - BIA/Kelsey, adviser to companies
in the local media industry, released a new
forecast today on U.S. consumer spending on
deal-a-day offers, which the firm expects will
grow from $873 million in 2010 to $3.9 billion
in 2015, representing a 35.1 percent compound
annual growth rate (CAGR). While this is the
most likely growth case, BIA/Kelsey suggests
a number of variables will have an impact on
the actual development of deal a day, such
as growth in the number of cities/sites, registered
users, transactions per year for the average
user and the average price per transaction. Considering these variables,
deal a day could grow to as much as $6.1 billion by 2015 (47.4 percent
CAGR), while a very conservative outlook pegs the space at $2.1 billion
(19.7 percent CAGR).
“Deal a day has experienced incredible growth during its three-year
incubation period beginning in 2008,” said Mark Fratrik, vice
president, BIA/Kelsey. “We expect this to continue as companies
in the space are rapidly adding markets and
increasing total user count. They are also
subdividing existing metros to provide deals
closer to where users live, which we believe
will help offset any drop-off that may occur due to consumer fatigue
as the novelty of the form fades.”
While Groupon and LivingSocial lead a marketplace of 200-plus players,
the broader field includes destination sites and white-label providers
working with local media providers such as directory companies, newspapers,
and radio and television operators. As of March 1, 2011, BIA/Kelsey
estimates there are 178 cities with deal-a-day sites reaching 102 million
people in the United States.
“The combination of fun offers and convenience makes deal a
day a very attractive way to reach local users,
and for publishers to work with small businesses,” said Peter
Krasilovsky, vice president and program director,
Marketplaces, BIA/Kelsey. “We
expect to see some shift in local media spending
resulting from the adoption of deal a day by
local advertisers. We also believe that deal
a day doesn’t exist
in a vacuum. It will become a part of the growing
deals and offers landscape.”
BIA/Kelsey President Neal Polachek added, “With the release
of this latest forecast, BIA/Kelsey offers its clients and community
additional insight and expert coverage of the multidimensional local
media space.”
BIA/Kelsey’s Deal-a-Day Forecast (2010-2015) is available to
clients of the firm’s advisory
services. For more information
on becoming a client, contact Steve Passwaiter at (703) 802-2973 or spasswaiter@bia.com.
Deal a Day at ILM East
BIA/Kelsey analysts will highlight details from this new forecast
at Interactive Local
Media East (ILM East), March 21-23, Boston, Massachusetts.
Day 3 of the conference features a half-day SuperForum devoted to “The
Local Offers Revolution: Group Buying, Promotions, Flash Sales and
SMB Services,” in which LivingSocial Chief Executive Officer
Tim O’Shaughnessy will keynote.
The SuperForum includes a number
of speakers from across the deals and promotions
space, including JP Bedoya, senior director, product, Citysearch; Jim
Boutin, cofounder and COO, Local Thunder; Brian Costello, GM and VP,
digital media, The RedPlum Network, Valassis; James Green, CMO, Travidia;
Jimmy Hendricks, CEO, Deal Current; Ken Kalb, CEO, Analog Analytics;
Jonty Kelt, cofounder and CEO, Group Commerce; Jim Moran, cofounder,
Yipit; Victoria Ransom, founder and CEO, Wildfire Interactive; and
Nate Richardson, president, Gilt City.
For more information about ILM
East, including the complete agenda, list of
speakers and companies attending, visit www.biakelsey.com/ILMEast2011.
About BIA/Kelsey
BIA/Kelsey advises companies in the local media space through consulting
and valuation services, research, Continuous Advisory Services and
conferences. Since 1983 BIA/Kelsey has been a resource to the media,
mobile advertising, telecommunications, Yellow Pages and electronic
directory markets, as well as to government agencies, law firms and
investment companies looking to understand trends and revenue drivers.
BIA/Kelsey’s annual conferences draw executives from across industries
seeking expert guidance on how companies are finding innovative ways
to grow. Additional information is available at www.biakelsey.com,
on the company’s Local
Media Watch Blog, and on Twitter at http://twitter.com/BIAKelsey.
