When Special Offers Are Too Much

Above is a screenshot of my email account showing the last month or so’s email newsletters from ASOS. You’ve probably noticed it as well, ASOS are offering a lot of special offers at the moment to try and entice you to spend spend spend with them. But is it harming them more than improving sales?

The recent Groupon deal sold 50,000 £20 vouchers for £9 each – so for each item that was sold, ASOS lost £11 that they would normally have received. (Assuming of course that Groupon didn’t take any money for running that deal – I’ve tried to find out how much of a cut they normally take on deals, and the most popular figure was 50% – assuming thats correct, for every £20 voucher spent on the site, ASOS received £4.50. Adding that up, they received £225,000 selling goods that would normally have earnt them £1,000,000. You don’t need to know anything about accounting to know that this is going to severely affect their accounts)

The amount of free delivery codes that are sent out every week (or even every day!) will also affect their profit. ASOS Premier is a subscription service where the customer can pay £25 (currently reduced to £15) and get free next day delivery for a year. Why bother subscribing though if you can hold out for a few days until the next free delivery email appears?

ASOS is still one of my favourite sites for clothes, but these emails are starting to sounding a little desperate.

Comments

  1. ASOS are driving me MAD with their constant offer emails. I get two of each because they refuse to remove my old email address from their mailing list. Rage.

    The Groupon thing is really interesting. There have been lots of studies on Groupon and how their deals can actually damage businesses. The problem is offering cheap deals doesn’t encourage repeat purchases. People buy the deal, use it and never go back, so the business loses thousands in profits and gains very little in custom. I guess it’s not true for all deals but it’s interesting to think how it applies to ASOS. x

    • That is annoying! I’m having the same problems with another company that wont unsubscribe me, useless!

      I didn’t realise how much it can harm a business until I read this post > http://posiescafe.com/wp/?p=316
      I’ve bought a few vouchers, but they’ve been for places I wanted to try anyway, or liked going to already. Generally (and this is only for the local deals), they’re for places that were relatively new but even that doesn’t explain why ASOS chose to do it.

  2. I don’t understand why ASOS did Groupon, surely they are a better match for local and new businesses? I did buy a voucher and I browse Groupon voucher but ASOS is so hit and miss for me so I often don’t bother!

    Maria xxx

  3. I love ASOS but they seriously do bombard me with emails. I used to read them but now they come practically every day I just delete them now.

    I still need to use my groupon voucher. Funny how a site can have thousands of items on but no ONE item in that price range jumps out saying ‘buy me!’

 

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