Partner Feature: The Great Daily Deal Discussion
The Great Daily Deal Discussion
eBay has become a household name, so when they say they want to work with you, it’s a great opportunity. And, as is the case with most great opportunities, big results are expected. eBay’s Daily Deals promotions have surfaced many times within the B2B bulk gift card channel. This opportunity allows eBay’s audience to take part in the purchases of gift cards with special values and discounts. While this is great for the consumer, there are many aspects to consider to make this opportunity a reality. At times, this process can intimidate brands or scare them away. Here, we will discuss the intricacies of eBay’s Daily Deals platform as it relates to bulk gift cards, and provide insights to help your team decide whether this opportunity is a viable option for your brand.
What’s a Daily Deal?
The first thing to discuss is the eBay Daily Deals platform. Quite simply, this opportunity is akin to any ordinary B2B program bonus promotion. However, in this case, there is a consumer facing discount presented via the eBay site. These discounts are often much larger than what most bulk gift card brands give to their buyers. For instance, if your brand was participating, you might provide a $5 bonus card with a purchase of a $25 dollar gift card. The consumer would receive a $30 worth of gift cards, having paid only $25. Other deals are richer – you could also provide a $200 gift card that any consumer could purchase for $180, a 10% discount. eBay also has the ability to place a cap on the quantity of cards sold, giving protection to every brand’s inventory. These offers have proven to be quite successful for eBay, and of course, very popular with consumers. Often times, these deals will sell out.
With the rise of digital products, there are opportunities for both plastic and digital participation. NGC and SVM handle the plastic opportunities and Blackhawk and Incomm manage the digital. For the best exposure it’s always best to do both plastic and digital, however, each category is so successful on their own, you will likely see a lift either way. To participate in a daily deal, there are a few things that are needed from merchants in terms of digital or plastic inventory. If there is enough inactive stock or inventory being held by the promoting partner, then no additional printing of cards is necessary. The promoting partner and eBay will need access to activation in order to fulfill the needs of all orders, so a connection to the retailer’s processor is necessary as well.
You Can’t Spell “Profit” without “Pro”
Now that the details are out of the way, we can discuss the pros and cons of this opportunity. The pros are obvious: a significant amount of gift card sales will be generated over a short period of time. If the timing proposed by eBay isn’t the ideal timing for your brand – perhaps it’s a Q2 opportunity and you are looking for a lift in Q3 – you have full power to negotiate the timing and schedule. This flexibility is a huge “pro” for any brand as it gives you the chance to make the most out of this opportunity and generate additional exposure. If your brand is already mature in the B2B space, this could be a great way to break into a different market and to test the popularity of your cards in this channel. More sales, more exposure, growing popularity in a consumer market, and a chance to generate revenue during periods where it’s needed are all big wins for any brand.
You Also Can’t Spell “Confusion” without “Con”
Where the difficulties lie with eBay’s Daily Deals are in the cons. The margins for these deals are high, and you might have to invest that extra 5% of a discount to create the best ROI. The possibility of a negative ROI can occur because of those high margins, and this risk tends to scare retailers away. In addition, if your brand is not able to provide the access necessary to a processor, promoting partners like SVM require the retailer to commit to providing void and replace and devaluing action should there be any need for them. This requires a fair amount of preparedness from the retailer that may prove to be too difficult.
The Voice of Reason
While deciphering between the pros and cons, there are a few key points that should be considered. There is great opportunity and flexibility to make these Daily Deals the right opportunity for your brand. This is not a one size fits all promotion, and that can be the best choice for any brand looking to test new revenue sources. There is also a lot of exposure because of eBay in general, and although they are the world’s most well-known eCommerce bidding site, eBay is more than just a place for discounted items. Their charity efforts have raised millions of dollars for various causes, and there are many rules in place to protect sellers and buyers alike, allowing them to keep a reputable standing in the eCommerce community. With eBay as one of the largest online platforms to be featured on, the value of new eyes and education on your brand is high.
The struggle to find the best promotions for your brand can be overwhelming. Luckily, you have SBGC to help. The strongest promotional results come when opportunities are carefully considered, and while the eBay Daily Deals can seem confusing to some, remember that they can be quite profitable at the right times. Whether after reading this you feel a Daily Deal is not your cup of tea, or it could take your sales to the next level needed, it’s all about finding the opportunities that make the most sense for your brand. SBGC will continue to be your support system in finding the best-suited revenue opportunities for you. After all, your success is our bottom line.
To learn more, contact your Account Executive.
