Stations See Gold In Couponing CrazeGoogle’s courtship of Groupon showed just how big digital daily deals can be 12/13/2010 12:01:00 AM Eastern
Coupons, once the dog-eared province of elderly ladies slowing
down the checkout lines at the grocery store, have become one
of the hottest trends in local television. The digital version of
the paper coupon—email deals from area vendors—is the latest frontier
in the battle for the local marketing dollar. And TV stations, with their
long-established multi-platform reach in
the community, appear supremely poised
to grab a piece of the action.
“We can win business because of our
local media assets,” Joe Weir, general
manager of Belo’s interactive division, says
of the group’s new Yollar.com couponing
initiative. “I think this is going to make
a pretty big impact on our bottom line.”
If people weren’t familiar with Groupon
before, the company hit countless
radar screens when Google made a reported
$5-$6 billion bid for the Chicagobased
tech start-up in recent weeks. More
astonishing than the size of the bid was
that Groupon turned Google down.
Groupon did not return calls for comment.
The company has local Web franchises
all over the country, where users
sign up to receive daily emails offering
discounted goods and services from vendors,
which split the sales revenue with
Groupon. On Dec. 7, for example, New
Yorkers saw an $88 ticket to the Broadway
show La Bete offered for $44.
Groupon also partners with media outlets for a different batch of local
bargains. Media General launches its first TV-station Groupon campaign
Dec. 13 at WCMH Columbus; the company’s first Groupon partnership
was with its Richmond Times-Dispatch newspaper in October.
WCMH built a registration list of about 3,000 users in early December
and has been talking up “Columbus Deal of the Day—Powered by Groupon”
in on-air promos, through keywords bought in Web search, and
through social media. Unlike similar programs at some other stations,
WCMH does not drive the sales effort for the couponing—Groupon does.
Traci Hogue, WCMH director of multimedia content and marketing,
says the low cost of entry makes “Deal of the Day” a promising revenue
source. “If our estimates are right, we think it has the potential to be six
figures [annually],” Hogue says. “And that’s without hard costs.”
The coupon initiative hits local TV’s sweet spot. Stations are increasingly targeting local mom-andpops,
which may not have the
budget for TV spots, with an array
of cheaper digital marketing options.
Stations are also focused on
dispersing content—and advertising—
to users’ smartphones, and
using social media such as Twitter
to broaden their reach.
There’s a big pie to be carved
up. By 2014, BIA/Kelsey forecasts
that local ad revenue in the U.S.
will hit $144.9 billion.
All of this plays into stations’
couponing craze. eDeals.com has arrangements with Post-Newsweek
and Cordillera Communications, among others, to offer coupons on the
stations’ sites. Some Meredith outlets have partnered with GreenLink
and see the coupon program as an extension of their viewer loyalty
programs. Jason Mullenix, director of sales at Meredith’s WGCL in Atlanta,
envisions the couponing initiative
banking around $250,000
in 2011—and likely climbing to
seven figures in a few years.
“It’s not 10 big deals—it’s 200
small deals,” Mullenix says. “We’ll
make a big pitch on it in 2011.”
Yollar.com debuted in November
on Belo stations in Dallas, New
Orleans and Norfolk, among others;
the entire group aims to have
the program running by the end
of February. Some stations booked
six figures’ worth of revenue from
it within a few weeks of launch,
The prime advantage of Yollar.com over the likes of Groupon and
LivingSocial, Weir believes, is that a
TV station can talk up the program to
the masses on-air, on the Web, and on
mobile. “Leveraging our assets allows
us to have a big megaphone,” he says.
Another key is that stations have
decades of equity baked into their
brands, as opposed to a Web start-up that many have never heard of.
Even if a local merchant fails to move a thousand coupons, many see the
value of co-branding with a leading station.
CBS Television Stations has been playing up its local outlets’ goodwill
in the months since the debut of CBS Local Offers, which hawks the
likes of salon treatments and cooking lessons. “Small and medium-size
businesses like it that a trusted brand like CBS has come forward to
them,” says Ezra Kucharz, CBS Local Digital Media president, compared
to forays from the less-established start-ups. Moreover, broadcasters appeal
to a larger swath of the population, adds Kucharz, while the Web
pure plays skew younger and more female.
It all spells considerable revenue potential for stations. “It’s an exciting
time for local media,” says Kucharz. “A number of new revenue streams
are really coming to life.”