Blog: February 2011

E-commerce Fraud declined in 2010

Online fraud was down in 2010, although we shouldn’t be too excited about it – it’s more than likely due to the general decline in the economy, rather than improvements in security. Check out the full article at the New York Times GadgetWise blog.

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Maybe that Groupon deal isn’t so awesome

MerchantCircle released a big survey yesterday detailing the rise of social media among small businesses as a cheap, effective marketing tool. Among the more interesting results is the conclusion that “social media are now the top marketing strategy for local businesses” – we wonder if that trend will continue or if social media-based marketing is simply having its moment in the spotlight right now.

What raised our eyebrows was this statistic: “55 percent of people who have run a daily deal campaign said they would not do so again.” That means that Groupon, LivingSocial and all the other group-buying knockoffs are either doing a terrible job at customer retention or that perhaps the group-buying premise is a flawed one – at least for the businesses themselves – to begin with.

Our experience with group buying in a business-to-business e-commerce environment has been mixed. Everyone seems to want it, yet once it’s implemented, adoption tends to be very low (or, in some cases, nonexistent). At least part of the reason for this is that, despite the appeal of group discounts, many business purchasers don’t really want to wait to see if their colleagues are going to buy something just to get a discount; purchases are driven by need, as opposed to by impulse.

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