Would You Sneak a Peek?

I was reading about some new variations on daily deal sites today in this month’s Trendwatching. There were a few neat ideas making the rounds:

  • Savored: Pay $10 for a reservation at a nice restaurant through the site, and then get 30% off your meal at that restaurant. No coupons or printouts–you register your credit card so you can be a smooth operator when the bill comes.
  • Groupon Rewards: Instead of trying to find new customers, this program helps you keep the ones you have coming back again and again. The more they spend (with their credit card–no coupons or printouts needed. That seems to be the trend), the more deals they unlock.
  • Munch on Me: Weekly deals on specific dishes at restaurants. That way restaurants have complete control over the inventory, and they can “teach” customers to try (and fall for) dishes that maybe they usually wouldn’t try.

But the most interesting twist on the daily deal site is Sneak Peeq. I’m not sure it’s the best, as I’m having a hard time understanding the concept, but there’s definitely something interesting going on here.

Take a look at the screenshot from Sneak Peeq at the end of this entry. We’re looking at a large box of chocolates–a single box, mind you. Not everyone who participates gets a box of chocolate.

You know the street value of the chocolate ($67), but you don’t know what the current price is. That’s hidden. You see, every time someone sneaks a peek at the price, the price goes down. [Update 11/8: Apparently Sneak Peeq underwent a redesign the day after I wrote this entry. The concept is similar, but not exactly the same.]

There’s no catch to this–you get 10 peeks a day to use anywhere on the site. You sneak, it tells you how much you personally made the price go down, and then you have 15 seconds to commit to buying it. So every time anyone sneaks a peek (peeq?), the price goes down for everyone…but only one person can buy the item. Once someone buys it, the price for the item jumps back up to retail, and only more peeks will start to lower it again.

You don’t know when the item has been purchased, so you might hold off on your last peek in the hopes that the price will be really low, and then when you finally peek, you see that someone else already bought the item and you’re stuck with a much higher price.

Very cool, right? I agree. There’s some gamification here, and you have the potential of getting a really great price. There’s also an incentive to share with your friends, since they’ll help the price go down. And sure, you might “lose” out on a great deal, but you’re only losing a minute or so of your time.

Where I’m stuck is: What does the company selling the product through Sneak Peeq get out of the deal? At the end of the day, maybe this chocolate seller sells 20 boxes of chocolate for roughly $25 each. So they’re losing money on each product. And sure, they’ve gotten some exposure from the site, but after using my peeks trying to get the price lower, I’m not any more likely to buy that chocolate at full price elsewhere. I’m just more likely to return to the site tomorrow to use my peeks for a possibly low price. What does the merchant gain?

Solve that puzzle with a satisfactory answer and get 20 Jamey Points.


7 Responses to “Would You Sneak a Peek?”

  1. Car says:

    I would compare this to The Price is Right. Only one person has the chance to win the prize, but the company/product being showcased gets exposure to a large audience without having to pay for advertising. Though I’m not a big chocolate fan, those chocolates look so interesting that I might drop a hint to a special someone that they would make a nice gift or that we should try them together sometime…

    We know people hate (and ignore) banner ads, so maybe this is the new online advertising. Actually put it in the hands of the visitors so that they feel they are opting to see an ad and interact with it – creating a sense of urgency and desire – versus it being shoved in their face.

    I love that you dropped “gamification”, it’s my favorite word of 2011.

    • Jamey Stegmaier says:

      I really like your point about banner ads. In fact, this could be a very cool kind of banner ad–one where you click it to make the price go down, or you can delete it and have a different product show up in its place. I guess that’s kind of what Facebook does, but without the “peek” option.

      Although I still want to know what’s in it for the company selling the product. Sure, they get some extra exposure, but is anyone more likely to buy their chocolates at full price after this? There’s a missing component here, I’m sure of it…

  2. Jill says:

    I think it’s going to end up being the same situation with Groupon (along with all those other “deal” sites). Groupon started off great because all of the companies who used it were getting exposure and Groupon was making a ton of cash. However, the companies realized they weren’t making a profit off of selling $50 worth of food for $25, so a lot of them have backed off that type of advertising. Groupons profits dropped considerably after their first year and I think they’re going to be struggling to not be in the red this year. I just read an article on this the other day – if I can find it again I’ll post a link.

    • Jamey Stegmaier says:

      I think I read something about that the other day too, that Groupon was valued (by Google) at $6 billion a year ago, and now it’s worth less than $1 billion. Still a lot of money, but that’s a monumental difference.

  3. Jill says:

    https://www.riverfronttimes.com/2011-10-13/news/groupon-fail-st-louis-local-harvest-yelp/

    Of course, this is just local… but I imagine it has happened to a lot of places.

    • Jamey Stegmaier says:

      That’s a great article. I think that the daily deal revolution will evolve into the Groupon Rewards concept that I mentioned at the beginning of this entry–a new wave of loyalty programs for existing customers that don’t hurt the business but rather keep people coming to their business instead of others.

      • Jill says:

        Yeah, I think some sort of loyalty program would have to be implemented to keep it going. That being said… I’ve never ever purchased a daily deal from any site, Groupon or otherwise.

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