Just to be fair, daily deal e-coupons probably will never go away completely — nor are daily deals entities like Groupon (NASDAQ:GRPN) and LivingSocial.
Now that the euphoria is wearing off, however, it’s clear the triple and quadruple-digit growth rates from 2010 aren’t sustainable, even though traders plowed into these stocks as if they were sustainable.
One of the chief complaints about the e-coupon industry is that the marketing tactic doesn’t actually cultivate repeat customers — it just forces a merchant to sell goods or services at a loss. It’s not a complaint that applies universally, though; some vendors have been able convert those one-time customers into repeat customers. Those stores are just far less common than first assumed.
As of this writing, James Brumley did not hold a position in any of the aforementioned securities.