The market for daily deal sites reached a point of oversaturation where even Christian Zigler – a Danish entrepreneur who started his own such business, Shopbox – grew tired of them.
Companies like Groupon, Living Social and Google Offers helped direct would-be customers to new businesses offering substantial deals on products, such as 300kr worth of food at a restaurant for half the price. The services would then take a cut of the profits from those sales. But customers soon became overwhelmed by the onslaught of deals thrust at them by sites.
“I was getting emails about haircut offers,” Zigler said. “And I’m bald.”
Zigler, 40, founded Shopbox in 2011 with an aim to build a more strategic business. He also consolidated the process for retailers, who leverage their own social media followings instead of having companies send out random offers that more likely than not end up in spam folders. The goal, however, is the same: to get new foot traffic into stores and hopefully convert those people into customers.
“We wanted to build something a little more sophisticated and be able to provide something that will make it likely for merchants to not only get a customer, but a happy customer,” Zigler said.
In two years, Shopbox has grown into a company with 20 employees. Zigler makes it a priority to recruit foreign talent, and that’s represented in a staff covering eight different nationalities.
Zigler is a self-described “serial entrepreneur” and has now been involved in four startups since graduating from the Copenhagen Business School. He built two of those ventures from the ground up, starting with Preview Networks – a movie trailer aggregator site – before creating Shopbox.
Where Shopbox differs from the mainstream daily-deal sites, according to Zigler, is a more tailored approach to customer relations. During the height of the daily-deal boom, businesses struggled to turn bargain hunters into regulars. And customers complained of second-class treatment when they arrived with their offers, or found businesses unprepared to deal with a rush of new customers.
“There were a lot of quick winners, but then the market consolidated,” Zigler said. “The ones who can stay in the market need to have a niche.”
Under Shopbox’s more streamlined approach, someone who follows a neighbourhood café or bar on Facebook might be more inclined to pop down and take advantage of a deal rather than gamble on an unknown establishment further out. On the business end, a proprietor has the tools to create a deal in a matter of minutes, without having to schedule the offer in advance.
Experts suggest that a more intelligent approach to the daily deal practice could be beneficial to businesses.
“It’s a marketing ploy, and it’s meant to provide long-term value by introducing new customers to your business,” said business reporter Sarah Needleman in a video posted on the Wall Street Journal website in March.
Several Copenhagen-based businesses (such as Green Sushi and Bar7) use Shopbox, and Zigler hopes the simple-to-use interface will allow him to expand to customers abroad.
“I think we’ve found the right level,” Zigler said. “Relevant offers, enhanced communications and empowered customers. A more sophisticated approach.”
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