Star Tribune adds Groupon-like deals

The Star Tribune is now aping Groupon — the online “deal a day” that delivers advertisers flash mobs of discount-seeking customers.

On Thursday, startribune.com unveiled its first STeal. Executive Director of digital Jason Erdahl isn’t coy about how much cash the online coupons should generate: $40,000 to $50,000 a month, or around half a million dollars a year.

I’d peg Strib annual ad sales at between $120 million and $140 million, so STeals won’t STop the Strib’s revenue challenge. Erdahl notes current forms of online ads, including banners are more lucrative. Still, the online world’s sales solution is rarely a silver bullet, but lots of BBs.

Erdahl says the Strib set up STeals independently of Groupon. National newspaper chains such as former Strib owner McClatchy Co. have entered partnerships with the pioneering discounter.

The Strib first noticed Groupon last winter, Erdahl says, and spent most of this year talking to customers and advertisers. He contends the paper’s sales force is more in touch with local merchants and can better build deals and integrated sales programs resulting in long-term customers. (I’m guessing most folks who used one of the first STeals, a $5-for-$10 at Sonic, are already addicts.)

Future offers may also cap the number of coupons, so less-savvy merchants can avoid being swamped — a dynamic noted in this AP story the Strib ran three weeks before STeals debuted.

Comments (2)

  1. Submitted by Rick Ellis on 08/25/2010 - 10:15 am.

    You’re right, it’s only a small part of the Strib’s digital revenue, but it could be a solid stream of new money.

    I’m giving it a shot, but the challenge will be to give value to people across the Metro area. Offering a deal on a business located in downtown Minneapolis or St. Paul won’t be attractive to folks like myself who spend most of their time in the hinterlands of the south suburbs.

  2. Submitted by Larry Werner on 08/25/2010 - 10:30 am.

    Offering a deal on a business located in downtown Minneapolis or St. Paul won’t be attractive to folks like myself who spend most of their time in the hinterlands of the south suburbs.

    Rick: At Thisweek Newspapers, we don’t consider south metro the hinterlands, and you obviously don’t either. Before the Strib launched its STeals, we started our version of the group-buy coupon. We call it DealzOn (www.thedealzon.com), and it’s available through our website — http://www.thisweeklive.com. And as a south-of-the-river news company, we will focus on the companies and consumers we serve in Dakota County. — Larry Werner, general manager, Thisweek Newspapers and the Dakota County Tribune

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