Daily deal giant Groupon launched its biggest deal yet yesterday through its exclusive ecommerce solution after teaming up with fast food giant Quiznos. The deal was a punch card for eight Quiznos sandwiches and was priced at $26, about half the regular Quiznos price, and can be used at any of the restaurant’s 2,100 locations in the US. Although a single customer may only use one punchcard, Groupon subscribers may purchase as many as they would like through their ecommerce solution. The deal never expires, but those who do purchase it need to get their first sandwich by July 4.
Individual Quiznos locations had done one-time individual offers with the daily deals site before, but this particular deal was organized with the chain’s parent company, QIP Holder LLC, who initially approached Groupon for the deal. Looking at the number of locations, this deal could be even bigger than Groupon’s deal with Gap, Inc. last year. Gap has about 1,100 locations nationwide, and sold about 440,000 of its offer last summer through Groupon and managed to crash the ecommerce solution’s servers in the process.
The appeal of a punchcard instead of a one-time deal is that it generates return customers, giving the business more value and brand reinforcement. The new type of deal allows both companies to expand their market to new demographics as well as aid in the development of new products. We can expect success for nationwide businesses looking to build customer loyalty if Groupon fully adopts this practice with other large companies before its competitor, LivingSocial.
Last year, LivingSocial made a jump in catching up to Groupon by selling 1.4 million two-for-one vouchers from one of its leading investor, Amazon.com. Competition has been fierce between these two contenders, with a flurry of smaller group/daily deals sites springing up in the middle ground. There were parent/child deals, green deals, private fashion deals, and everything in between. As the number of daily deal ecommerce solutions in the group-buying realm keeps expanding, business will be driven by customer choice: you’ll go with the deal site that speaks to you and your demographic and your needs.
With deals like the Quiznos one, expect bigger and bigger deals to come to subscribers of both Groupon and LivingSocial. Will it necessarily be enough to keep them on top? Who knows.