Over the last few years small businesses have started thinking differently about how to attract new customers and grow their business.

While in years past marketing strategies had been built around a theory of sell, sell, sell—today, it’s become much more about connect, listen, communicate, and engage.

With tools like email marketing and social media marketing, businesses aren’t solely focused on driving awareness, as was the case with traditional print advertisements for example, but instead are focused on learning more about their audience and building relationships through content and online communication.

When you look at the amount of success small businesses have had with this evolving marketing strategy, it’s clear that businesses owners have started to get it.

Looking at the model being put forth by other deal companies however, and its clear big-name deal providers still have a lot to learn.

What’s wrong with the current deal model?

At first glance, the model being offered by the big-name deal providers looks to make sense. By exposing smaller businesses with limited reach to a wider audience, it seems rational that deals would help attract new customers.

But the problem with the model put forth by big-name deal companies is that they really aren’t fulfilling their part of the bargain.

If today’s small businesses are reaching new customers and growing their business by connecting with their target audience online, why have deal companies refused to pass deal buyer information over to merchants?

Why is it that when I buy a deal from a local restaurant or retail store, my information is going to a deal company located outside of my community, with limited investment in my personal interests or needs as a consumer? Something just doesn’t add up.

A solution that makes sense

When we launched SaveLocal last year, this was just one of the growing problems in the deal industry we wanted to fix.

It was difficult to understand why a deal provider, whose purpose is to help businesses reach new customers and grow their business, would cut business owners off from the thing they needed most.

But then we got to thinking—maybe we were wrong. Was all this communication, engagement, and listening stuff really a waste of time? Maybe the deal companies were right and the small businesses were wrong.

So, in a survey of 1,400 deal buyers, we asked:

Agree or Disagree: When buying a deal, If I like what I get from a deal, I’ll become a loyal customer.

The result? 60% of consumers disagreed. Much like small businesses, consumers expected more from deals than just a one-time offer.

The SaveLocal difference

To fix the problem, we decided to try something new. Instead of controlling the deal ourselves, we decided that SaveLocal would put control back in the hands of the small business owner. We decided that small business owners understood better than we ever could what type of deal would work with their audience.

We also gambled on a belief that if given the opportunity to promote the deal themselves, to the audience they already had an established relationship with, that they could also reach just as many new customers via word-of-mouth as they would have with another deal provider.

After all, for 50% of consumers, nothing is more important than the personal recommendation of friends and family members when it comes to making a deal purchase decision.

It was a radical change from what had been offered by big-name deal companies in the past. And guess what? It worked!

On average, 22% of buyers from a SaveLocal deal are completely new to that business—compared to 29% of deal buyers from leading companies in the deal industry. Unlike those other deal companies however, with SaveLocal, each of these new customers means a new contact for the small business and another opportunity to continue the relationship after the deal has ended.

Growing a quality email list with SaveLocal

By being able to handle the promotion of their own deals and collect customer information in the process, small businesses aren’t only reaching more customers, they are reaching a more quality audience.

That’s not to say people who buy deals from deal providers are any worse because of it. But without access to buyer contact information, deal providers have added an unnecessary roadblock in the path to building valuable customer relationships. Instead of being a bridge to a long-lasting relationship, deals have become a dead end street and consumers and business owners are suffering because of it.

By being able to promote your deal to your current audience and encourage them to share with an added sharing bonus, your new contacts will already be part way across that bridge.

Chances are, they are local and have a relationship with at least one of your current customers. It’s also likely that they share at least some similarities, needs, wants, or interests with the people who you’re already engaging with every single day. You’ll already know how to speak with this new audience, because these are the type of people who helped you grow your business in the past.

All you need to do is continue to connect, listen, communicate, and engage. That’s how you turn deal buyers into new customers—and that’s a type of deal that makes sense for small businesses.

Want to learn more about how to run an online deal that will actually help grow your list? Download our free guide Dirty Dozen:Dos and Don’ts of Delivering a Daily Deal.