New coupon organization targets college kids

Most people know DQ as the spot for blizzards and ice cream. What you might not know is there is a new “DQ,” and its goal is to take on a giant in the deal-per-day coupon business.

It’s called DealQuad, and it poses an alternative to Groupon.

According to TechCrunch.com, DealQuad targets college students by working with university newspapers, and already has a student following and access to local businesses that advertise. By working with these newspapers, DealQuad doesn’t have to hire a huge sales staff like Groupon has had to do, DealQuad’s CEO Jeffrey Appelbaum told TechCrunch.

The new “DQ” is already up and running at numerous colleges, including Harvard University and the University of Washington.

However, it is not going to be easy to challenge Groupon, the 500-pound gorilla of the industry.

Groupon, just one of the many “one deal-per-day” coupon sites, has emerged as a major player in the online retail world. Starting off as a strictly Chicago enterprise, Groupon is now in dozens of cities across the United States.

Daradirek “Gee” Ekachai, an associate professor of public relations, said Groupon deals are initiated by its customers, who then contact the vendors about selling coupons on Groupon.com worth about 50 to 80 percent off their products.

“I think the appeal of Groupon is the ‘cheaper by the dozen’ idea, and how the company uses social networking (sites) like Facebook and Twitter to spread the word,” Ekachai said in an e-mail. “Also, most deals last for six months — that would persuade power shoppers to click the buy button.”

Groupon reportedly makes its money by splitting the revenue produced by the coupons sold on its site with the companies it sells for. According to numerous reports on Groupon, those companies typically don’t make money off of the deals it offers on Groupon, but instead benefit from a huge increase in customers to its store.

Both Groupon and DealQuad use a group buying technique — the deals they offer aren’t official until a certain amount of people buy the coupon — to entice companies into offering better deals on their respective sites.

Connie Bauer, an associate professor of marketing at Marquette, is not convinced revenue sharing is the only way these companies make money.

“I went to these two sites and both asked for an e-mail address immediately upon landing on their homepage,” Bauer said in an e-mail. “Thus, my first impression is that both sites’ primary objective is to gather e-mail addresses for future e-mail promotions.”

Bauer said the privacy policy of the sites indicate both Groupon and DealQuad do share e-mail addresses with third parties for a variety of promotions.

Mike Herbst, a junior in the College of Communication, said he buys a product from Groupon about once a month. Herbst said a more local version of Groupon, like DealQuad, would be beneficial to both students and local businesses.

“I would definitely use DealQuad if it ever came to Marquette’s campus,” Herbst said. “Especially if they had offers for local places like Real Chili or Broken Yolk.”