This kind of crap has got to end. I am getting very tired of working my a$$ off to establish a good relationship with a merchant, only to see some scraper come along and benefit from my work. (They even listed the code as their exclusive code!)

First thing that strikes me is how difficult it is for somebody running an established affiliate site to accept that the business could be done in a non traditional way. The typical (or call it “legacy”) coupon site is operated by a stuff of a few people who get the coupons from merchants via affiliated channels and distribute them to their user base. The new breed however uses a different approach. They ride the “social phenomenon” and have the content posted to them by the community.

The new web

This can be difficult to understand for somebody who don’t keep their eyes open to what is happening around the web (which is often the case when you are “working your a$$ off” :-) ). Websites like Facebook, Twitter, and Youtube have popped up and boast millions of pages of content. Where did it come from? Did the YouTube owners post each video they have?

The same revolution happens in the affiliate world at a smaller scale and while the forum based website owners (like SlickDeals and Fatwallet) for obvious reasons have no issue with it, the traditional businesses do. So do some merchants. Here is one of them commenting to the same ABestWeb thread

My problem with RMN lies in that I have removed them from my affiliate programs, so they took it upon themselves to flood their site with every single unauthorized coupon code they could find, thereby compromising my marketing results. And what’s even more frustrating is that the consumer has no clue what they are doing is wrong. RMN tops my list of unethical affiliates and they seem to really enjoy the “bad boy” tag they’ve acquired in the affiliate world.

Consumers are not a hoard of animals. If they got to a RetailMeNot page they are intelligent enough to have figured out that they can use the web to search for coupons. That by itself is quite an achievement I should say. As to RMN flooding the site with “unauthorized” coupon codes. The codes are only “unauthorized” as long as the coupon site has an affiliate agreement with the store and guess what happens when you receive an email from a merchant and face a choice to remove the coupons or leave the program? This is exactly what we recently faced at Buxr when the email came from New York and Company. We took a hard look at what will be left should we remove the “unauthorized” coupons and figured we will be doing a poor service to our visitors and instead opted to break with the merchant. This may sound crazy to an affiliate old timer but this is the reality of doing affiliate business in a new way.

Too big to fail

There is a bit of irony in how affiliate network managers approach the situation. On one hand they take an action when merchants (or other affiliates) communicate problems to them about unauthorized use of coupons. Here is one such “action”:

OK, I found them in my CJ account and expired them. Thanks for the tip. They signed up last week so the URL was fresh in my mind.

If the outrage was over a small insignificant coupon site then this would be the end of the story, however as big as RMN has grown they represent significant lost revenue for any network that doesn’t stay on board and so the managers have a big incentive to keep things running, even to the extend of taking on policing the site for “bad” coupons. Here is a much later comment from the same manger (who took the action above)

Over the last few years I have developed an excellent relationship with RMN and am very satisfied with them. It takes me a minute to ask for a change or removal I control the copy on the merchants store page and optimize it. Don’t know other affiliates letting me do that.

So a compromise is possible? Sure thing. If there is a will there is a way and the fact that RMN rakes 4 million in sales each month somewhat helps the matter. :-)

And finally here is a comment that sums it up very well:

It is apparent that a) merchants like RMN because they bring in sales and b) affiliates are jealous of the RMN concept that has done very well. Not sure there is anything else to say about RMN.

Breaking old habits is hard but social bargain hunting is here to stay whether some like it or not. If old Terms of Service are no longer good then the new ones will be written. It is time for a change.

• Can a deal site be turned into a fun game where participants get rewarded for the bargains they recommend?
• Can the site modeled around this concept be a successful and profitable business?

Ever since Modoshi shut down in summer 2007 I have been sitting on this idea. But I wasn’t just sitting, I was actually doing something. Read on to find what kept me sleepless over the past several months.

What makes people share deals?

Why people come to deal forums to post the shopping deals they find? For the most part it is because of the community. Initially they come to get information, feel thankful for the support they find and eventually come again to give back to the community that helped them. You could say that the community feeds itself.

Sometimes the site owners make an effort to help the community grow. SlickDeals encourages participation via reputation points the deal submitters receive from the peers. With DealsPlus each deal submission brings you closer to the next level - another star by your avatar. All these small attributes help the participants build their place in the community, help them feel useful and rewarded.

What did Modoshi do differently?

Why did I like Modoshi when there is already a number of striving bargain hunting communities out there? Because the team made an effort to improve on what some of these communities are doing. They have attempted to give the members a monetary incentive to participate and contribute. The incentives were offered in a form of daily and monthly contests that rewarded quality submissions and intelligent deal picks/votes which in turn brought a crowd of regulars to the site.

In addition Modoshi offered a huge number of tweaks for efficient bargain hunting on the site itself. The amount of product data they displayed made me think I am looking at a control panel of an airplane. It probably was a bit overboard but it appealed my geeky taste and built an invisible bond with the site creators.

I liked the idea so much that I decided to recreate it in a slightly modified form on Buxr, the project I started with my partner last year. Here are the basics (and I encourage you to comment on these!).

The daily contest

• Users submit deals. Every day one deal is selected “the best of the day” based on user votes and our own judgment. The user who submits this deal is rewarded a daily prize (currently $10 via PayPal).

The monthly contest

There are two ways to participate, via deal submission and via deal votes.

• Users submit deals. We select the best and the worst deal of the day on a daily basis. The user who submits the best deal gains 5 points, the user who submits the worst deal loses 5 points.
• Users vote deals up/down. At the end of the day we compare user votes with our deal picks. If a user votes up the best deal of the day, or votes down the worst deal of the day, they earn 1 point. If a user votes down the best deal of the day, or votes up the worst deal of the day, they lose 1 point.

The user who collects the most points at the end of the month earns the monthly prize (currently Apple iPhone).

We plan to tweak these rules going forward as we learn from the participants, but the goal will stay the same, to build an exciting environment for people to come and share shopping deals, given whatever limited resources we have at hand.

Modoshi failed. Why am I doing this?

I strongly suspect a part of the reason why Modoshi closed was the lack of experience from the team (or the individual) who was running the site. Both my partner and I have been in this niche for a while and have come here to stay. Buxr doesn’t bring any significant revenue right now, not even enough to compensate for the prizes we offer. Yet we believe that the community around a deal site is the single most important side of a successful shopping affiliate business. It brings life, triggers conversations, helps with viral marketing.

Personally for me, it also gives a meaning to my life. I have always said that comments on this blog make me wake up in the morning and write more. Buxr is my new (more bargains focused) way to talk to you guys. The good part is that now you can initiate conversations as well! :-)

Adding a full blown network is a logical step for RetailMeNot who already largely rely on community to submit and rank coupons. The new functionality allows registered users to make friends, share coupons/deals, showcase profiles, and blog about… that is right, shopping.

Any social network is only good if there is a community to support it, and this is what will eventually be the breaking point. Nevertheless, the site is certainly a leader in such a narrow niche as coupon clipping (currently ranking 2nd) and so I would say the network has a good chance for success.

Here are some interesting traffic and financial stats from the RetailMeNot launch announcement at TechCrunch:

RetailMeNot is pushing through some amazing figures for a bootstrapped (non-funded) startup with three employees. The site averages $4 million a month in sales that are accurately recorded through affiliate channels, with only 40% of codes on the site having a direct benefit for RetailMeNot. Estimated total sales through the site are $10 million a month or approx $100 million a year. 600,000 non-affiliate clickthrus were recorded in February 2007 and 440,000 affiliate clickthrus. The site offers 71,000 coupons from 13,000 merchants and is adding 200-300 new coupons a day, 300-400 new comments per day and 9000 votes per day. Traffic and revenue grew at 20% per month through 2007. King wouldn’t tell me how much the site was making, but told me that it was profitable in seven figures.

As you can see running a popular coupon site can be a very profitable business. It is unfortunate none of that goes back to the users who help build it, and I am not talking about ad revenue profit sharing on user forums. Show us the real money! ;-)

The site has been dormant

I went to check out the website and it does really look like Modoshi is having problems. The last deal posted dates July 26 and the last message from the admins at the bulletin board says:

Hello everyone, sorry for the almost non existent responses. We are deciding the fate of the site and are acertaining whether we can continue to support this model.

It looks like the idea hasn’t picked up as much as expected and the team of early adopters who came to play the bargain hunting game Modoshi was running (read: earn prizes) hasn’t brought enough main-stream users who would actually come to shop at the site (read: spend some cash).

Is business model broken?

When I praised Modoshi for its social direction, I didn’t pay much attention to the financial side of the experiment. It now looks like the model used by Modoshi lacks certain attributes necessary for a profitable business.

For example members are compensated for bringing referrals who then post quality deals. This makes sure that the posted products are true bargains. However no one is compensated for referring people who will come to shop. This means that the members are not directly interested in bringing revenue to the site.

I am sure the founders hoped that viral marketing would take care of this issue and it is hard to speculate why it hasn’t been successful for Modoshi. I still think the team has done a great job with the site and with a little bit more luck Modoshi wouldn’t be having problems now. The idea is good and it might just need a little help to pick up.

What will happen next?

I have sent an email to Modoshi but didn’t receive any response. An eBay exit might be one option, or alternatively the current founders may choose to re-adjust the model a bit and restart the experiment. In any case I hope we will find it out very soon. It is very sad to see a good idea die like that.

The auction (link) started on July 5 with initial price of $1.00 and gradually attracted bids over the 6 days period (I am sure this coverage at Techcrunch helped to float the price).

Trezr launched in October, 2006 and failed to ride the social revolution other deal sites enjoyed. It sports impressive design and some interesting features (profit sharing and a widget) however fails to implement certain key features a successful deal site must have. I have been following Trezr in my monthly list which it dropped out of in February when its Alexa rank fell above 100K threshold.

According to the auction description the website traffic at the time of sale was mere 4,000 visits and 7,500 pageviews per month and the service had 900 registered users. Other interesting details: Trezr was written using Ruby on Rails and is hosted on a dedicated server ($950 a year expense).

You launched Hawkee in 1997. What was it like to run a website back then?

It was just as exciting as it is today. Technology was impressive for the time and online communities were going strong. Everybody wanted a forum and many successful communities relied on them. Despite the lack of comments, feedback forms were very common and supplied a steady stream of compliments and accolades. It was just as exciting to receive feedback as it is to receive comments today. Internet communities were very new, but remain to this day to be just as cohesive and supportive as they were in the past. You didn’t need to think about monetizing your site because CPM ads paid very well under any niche. In retrospect that was the major flaw that burst the bubble, but times have changed and webmasters have learned from their mistakes. What made a successful website 10 years ago still makes one successful today. The only difference is the technical bar has been raised.

Hawkee has always been a place for developers to share code snippets. Why expand to shopping?

This is part of our plan to become a fully featured technology network. Since we are self sustained we need to work on our bottom line to remain profitable. Shopping directly affects the bottom line and has managed to sustain our company without any outside support. We use this freedom to implement social features requested by our community. Their suggestions and ideas are invaluable to us so we strive to give them exactly what they want. Without a sustainable business model we couldn’t do this. In the future we plan to balance out our offerings with more technology based features that won’t necessarily have anything to do with shopping or scripting.

There are a lot of price comparison websites out there. What makes Hawkee special?

Our price comparison is entirely unique. We establish our own relationships with sellers and do all of the maintenance and price matching on our own. We don’t use any API services like Shopping.com so our results are one of a kind. We’ve also been aggregating reviews from major retailers and offer a very comprehensive database of reviews. Our unique review system allows customers to vote on the reviews they find most helpful and leave comments. Customers can browse reviews by category rather than by product. For example a customer can read reviews on “black Mp3 players” or “32in HDTV LCD” TVs without choosing a specific model. We also have a unique tagging system that automatically tags products based on their technical specs. For example a 17in LCD monitor might have the tags “17in lcd black”. This allows for very specific filtering and digging through our product offerings. Besides these key features we also maintain current coupons and deals to ensure our customers are finding the latest discounts.

You officially launched the shopping engine at the end of 2006. What has been the feedback so far? Do people like what they see?

The feedback has been very positive. Customers have no problem finding what they’re looking for and we’re seeing a month by month improvement in our search usage. Our merchant partners love the site and have nothing but praise for it. We’ve become very attractive to many major online retailers and will leverage this in the months to come with more exclusive content.

What were some of the technical challenges as to adding the shopping functionality?

The most difficult challenge is organizing all of this data quickly and efficiently. With every new seller we increase the size of our database and the need for more server resources. When traffic is high during the holiday seasons we need to ensure that we can produce results quickly without any lag. Keeping the site snappy has been a focus since the beginning. Another challenge is organizing all of this data well enough that customers can browse, search and find exactly what they’re looking for. The data we receive from our sellers is not very cohesive and it’s up to us to bring it all together in a way that people can understand.

It is people who make social websites work and looking at product comments there doesn’t seem to be a lot of participation. What makes you believe Hawkee will succeed?

We will succeed because we’ve got the relationships and community to make this work. We’ve got partnerships with many major brand names and we’ve got a thriving community that’s growing monthly. As they become more aware of our newer offerings they’ll begin to adopt and utilize them more. And most importantly we’ve got the technical know-how to evolve and build a product that’s truly spectacular.

Do you run the website for living or is it a hobby? If you have another job, what is it?

Hawkee is a full time business. This website is our primary property, but we’ve also got a handful of smaller sites as well as some upcoming projects.

What are you like outside of Hawkee? Please share some fact from your personal life.

I’m a very laid back individual. I enjoy my peace and quiet most of the time, but I love to travel and socialize. You might catch me at events like the Linkshare Summit or Affiliate Summit. I’m a gamer at heart and put a lot of time into my Wii while I’m not working. I enjoy camping and visit the mountains several times a year to get away from my computer. Sometimes I tend to overwork myself, so if you catch me sending emails late at night please remind me to take a breather.

If you were to give just one money saving advice to ProBargainHunter reader, what would it be?

Definitely shop around. Don’t just check just one price comparison site, check them all. Find the lowest price between them and always double check the sellers for fraud reports. Keep an eye on the current promotions and check sites like SlickDeals and FatWallet. Don’t forget your local stores. Sometimes you can avoid high shipping charges by purchasing at a lower price online and picking up your purchase in the store. Keep a close eye on free shipping offers and always check for rebates and special offers. For example you can sometimes get a free notebook case when you buy a new notebook computer. And lastly always compare online and offline prices.

Dealspl.us launched in July of 2006 and quickly became a popular destination for bargain hunters after showing up on the Digg front page. To further stimulate participation the owners ran a series of contests where you could win an iPod or a USB Flash Drive for submitting deals. In fact your humble servant got one of these drives as well after playing with deals submission for a while.

The website launched with the premise that the content is community driven — anyone can submit shopping deals to be featured on the website. As I mentioned before, communities like these need a critical user mass to survive, and Dealspl.us is one of the few who are close to the point to become self supported (a couple of other sites worth mentioning are Dealigg and Modoshi).

The website has a very clean layout. The front page displays most popular deals in a grid fashion. You can navigate through the categories using the menu to the right. This is all Dealspl.us had when they just launched. The team gradually added features turning the website into a true social network. If you take a closer look at Dealspl.us now you will notice that being a registered user now means you can do a number of other things in addition to submitting or voting for deals.

You can participate in discussion groups, you can invite friends / relatives and identify them as such in your profile, you can browse the B&M store Sunday ads in the circular section. When Black Friday shopping season was in full swing Dealspl.us offered one of the most comprehensive Black Friday ads references, which brought even more attention to the site (see that second spike on the chart below).

The team has re-launched daily contests — a sure sign they are serious about gaining the momentum. The site has been holding position #16 in my popular bargain sites list pretty steadily however if you recount the traffic generated by these websites in proportion to the actual user shopping activity, they might as well be in the top 10. This is due to the fact that other sites in the list have some sort of side business which brings them most of the visitors, a good example is ResellerRatings who I reviewed last week.

Dealspl.us success is partially due to the fact that it is backed by the experience of Ben Chui, the owner of BensBargains, who co-founded Dealspl.us with one of his friends. Here is how he describes in his November interview what kick-started the idea:

I was approached by my former graduate student instructor about starting a new Web 2.0 AJAX site. He was entirely new to affiliate marketing and such, so I offered to help him break into the market. He’s a brilliant guy and he was able to get dealspl.us together in about two months! BensBargians.net is more of an editorial type site, which definitely has its place in the scheme of things; but with the hotness of Web 2.0 and user driven content, we felt like we had a winning idea with dealspl.us. So far, our projections have been spot on!

What can I say… well done, Ben. Give it some time and the child will overgrow its parent. ;-)

Students don’t have the money to buy textbooks, to attend the courses, to get a degree, to find a job, to earn the money as the result. Sounds like a chicken and egg problem, isn’t it? That is what Chegg is all about and that is where the name came from.

According to 2005 Government Accountability Office report textbook prices almost tripled between 1986 and the end of 2004 — rising by 186%. On the other hand teenagers and college students are probably the most active age group on the internet who are not afraid to try new things and experiment with new online services.

Chegg is the biggest of a several websites who try to monetize on this combination. The idea is very simple: build a community where college students can freely buy/sell used textbooks from each other and then use that community to make money by selling new textbooks and other merchandise. Here is how the marketplace works according to Chegg itself:

The diagram for non-students is slightly different and involves a small fee — one more way for Chegg to monetize the website which in turn has gained so much momentum that Chegg is receiving another round of funding ($2.2 million) from Gabriel Venture Partners and angel investor Mike Maples.

But the team didn’t stop at the local market of University campuses. They went further and have made it easy for the students to publish their books for sale at Facebook — the biggest high school and college oriented social network. Isn’t it smart?!

What can I say — where was I when it all started in 2001 at Iowa State by one of the university students? Wherever I was — it was the wrong place to be. ;-)

Source: Web Sites Challenge the Textbook Goliaths at BusinessWeek

The new kids on the block have been more fortunate in the sense that they started when Digg was already popular and many Internet users have adopted the idea so well that they were not shy digging things anymore. However if you look closely at these websites you will notice that they all suffer from the same problem: they have not built an active community — a community of users who would find and digg up the deals — the kind of community that only FatWallet and SlickDeals currently have.

This is not surprising at all. Bargain hunting is a very narrow niche. It took Digg over a year to become as popular as it is. It will take even longer for these sites if they follow the Digg model.

Social bargain hunting is plagued

We all know that Digg is not community driven in the sense that less than 1% of users control most of the front page news. This is partially due to the algorithms Digg has put in place to favor the top submitters but mostly due to the fact that only a small percentage of users is capable of devoting themselves to the long hours of sifting through the news looking for that Digg-worthy scandal story.

It is obvious that all of the bargain hunting sites currently don’t have even a fraction of the half a million Digg users. I will bet my car that the owners of these sites keep them on life support by searching and submitting deals daily and maybe even by manipulating the ratings to bring the most promising offers to the top for better visibility (for that same reason these websites usually don’t show who voted for the deals. Some don’t even show who submits the deals, at least not on the front page).

The conclusion — social element is there mostly to satisfy your feeling of freedom, to feed your desire to be in control, to create an illusion that you can make a difference. At this time the social part doesn’t do a good job of building a supply of fresh quality submissions for these websites.

How can this be fixed? What can be changed to make the system work? What will compensate for the lack of active users?

It sounds like Modoshi has the solution.

Who are the folks that submit news to Digg? They are mostly teens — school children and college students. They have a very strong feeling of community, they have the time and curiosity to try new things, they are willing to do it for free or for a very small pay. Modoshi is a community where users who submit or pick the best deals are financially compensated. Right now each user only has one shot a day at winning the two daily prizes — $5 for submitting a new deal and $5 for digging an existing one — however as the site growth the prizes will grow as well, according to Modoshi co-founder Vaishali Anga. $10 a day doesn’t sound a lot at all however keep in mind that Netscape was able to sway the top Digg users with a mere $1000 a month — and working for Netscape sounds like a full time job to me.

This is not all however. With each new deal the submitter has to verify 3 existing deals for accuracy. This just sounds like a terrific idea! Once the bugs are worked out the only thing that Vaishali will have to worry about is that his servers are capable to support the crowds of teens who will flock to play the game and earn that penny towards next Wii. By the way, about Wii, the top Modoshi user in January will get one for free — it is another contest the team is running and the prize selection only proves my guess at what the target age is. Seriously though enforcing verification should hugely improve the overall deals quality and as the result will make the site more attractive to those who come to use those deals.

Different game requires different rules

According to Vaishali when Modoshi launched in November it “started on the premise that it was high time contributors to the Internet community in general (who) got a share of the revenue”. The team quickly abandoned the concept though. “Pricier items such as TV etc got unfair advantage. Deal (submission) was based primarily on commissions, not quality”. The contests in contrast provide “a uniform model irrespective of what deal is posted, be it a $10 toy or $1000 hdtv”. Makes a lot of sense to me!

Now what about that rank that social sites display next to each entry? It usually more or less reflects the number of votes the entry accumulated. It makes perfect sense in the Digg case — how else can you judge the value of a news story? It sounds like for shopping deals you could use more data to calculate that number. The item price (compared to the average price for similar items), the item popularity (number of clicks or sales it produces), the submitter credibility — all of these can be factored in to compute the deal rank. Isn’t it brilliant? I wonder why no one else has done it before?

Conclusion

I have been playing with Modoshi over the past month or so and the more I play the stronger the feeling is that they have implemented the best marketing strategy to make a social bargain hunting site a success. I am not saying they are already the best — the site navigation and functionality could be improved quite a bit — but they currently have the best bets at coming out the leader. Sorry DealsPlus, you are not my favorite any more. ;-)

In addition online shopping has experienced very nice growth this year. Online spending during this holiday season are 25% up according to comScore. The growth has created an opportunity for new players to join the game thus growing the already long list of participants. Many of them are adopting social features.

Let’s go over some newcomers featuring social attributes and check what they are really worth. I used several factors for selection, among them are usability, functionality, innovation and design. Popularity often influences usability with social websites therefore let’s look at it first.

Comparing Traffic

The only thing that is clear from this Alexa chart that Dealspl.us is leading the pack while Modoshi is far behind. The rest three websites are somewhere in between.

In an attempt to measure how many deals these websites have I did a search for “iPod” on each of them and counted number of entries posted within the last 30 days. Besides I attempted to measure how fresh the data is by looking up the latest deal. Here is what I found as of 12/25/07 4:30 am (no, Santa has not stopped by yet :-)):

Be aware that some of the deals may be submitted by the people running the websites and hence these counts cannot be used to judge how popular the websites are. Nevertheless the numbers give an idea what to expect.

Dealspl.us

The side-project of its parent website bensbargains Dealspl.us may soon overgrow its dad. Dealspl.us had a privilege to come to the market among the first (if you don’t count the early experiments like dealcritic) and managed to do a lot of things right. Ben’s 6 years of pro-bargain hunting have helped to avoid mishaps. The content, while user submitted, is constantly moderated and refined. I am sure Ben feeds a few of his own deals every day to keep the things running smoothly.

The simple and nice looking design along with pre-filled quality deals content is what made the website a success initially. The team kept adding functionality and now I cannot really find anything that I wanted from a bargain hunting site that Dealspl.us didn’t have. Maybe just some minor things like email newsletter, hot deals widget, and a submitter web browser plugin? (Ben, it is a hint ;-) )

Dealigg

From the first glance Dealigg looks like a “not very polished” Dealspl.us copycat. Nevertheless it doesn’t prevent it from bringing in nice user traffic. Overall it is very much one step behind compared to the original. The coupons section, the friends feature, and the talk groups are just a few things that Dealigg lacks compared to Dealpl.us. Read my earlier Dealigg review to get a better picture.

Deals.com

The creators of Deals.com have put aside sufficient funding for the domain name and web site branding yet they failed to assess the level of saturation in the bargain hunting market. A great domain name and a cute logo could bring crowds of visitors a year back but not today.

As the result the website is somewhat stagnant (see the table above). I wrote about Deals.com earlier and why it may fail. Another example of a nicely designed quickly forgotten website is Trezr — read my review here.

Dealplumber

Dealplumber started around the same time as Dealspl.us and originally boasted a higher Alexa rank due to slightly earlier launch and the “share deals & earn” program which allowed affiliate ids in the submitted links. The website however wasn’t as well designed as Dealspl.us and most importantly it failed to deliver quality deals which in turn didn’t work well as far as retaining a user base goes.

Very recently they have somewhat improved the website design and navigation however it is still not as convenient as I would like it to be. Just a few things:

• The menu at the bottom is hard to see (and there are some important things there)
• There is no way to access all related store deals from a single deal page
• I cannot mark a deal as a spam or expired

The web site functionality overall is a subset of that of Dealspl.us

Modoshi

Launched just last month Modoshi is trying to succeed where Dealplumber failed — revenue sharing — hence the web site name which in Japanese means “giving-back”. “Typically, Modoshi will receive 7 to 8 percent from an affiliate for each sale, and on average, 40 to 50 percent of that commission will go to the user who posted the deal”, according to the website’s co-founder Vaishali Anga.

I remember the main problem with Dealplumber was spam. Users would submit low-quality deals and benefit from the clicks the website attracted after the launch. In an attempt to improve the deals quality Modoshi is running daily contests. There are two ways how you can win a prize (currently $5): post a best selling deal or pick the best selling deal. While you can post or pick as many deals as you like only one deal and pick can be submitted every day to the contest. This is a very smart move which will certainly pay off.

While Modoshi may be a fun game to play for school kids it still lacks some must-have features. For example I couldn’t find any way to browse deals by a merchant. They also don’t seem to have a separate section for coupons/promo codes. The thing I liked is that I could rank deals up and down without being logged in (the vote is associated with my IP address). This should give a boost to the user activity that Modoshi needs so much.

Conclusion

I have ranked each website on a 1 to 5 scale where 1 is the worst and 5 is the best. Here is the run down:

No question Dealspl.us is the current leader in social bargain hunting. Judging by the features and the innovating marketing campaign Modoshi seems to be the next runner up. Dealigg is playing catch ups while Dealplumber is recovering from the early mistakes. Deals.com has good potential (especially given its catchy domain name) but the team needs to introduce some more innovation into what they are doing.

2006 marks the first year when social bargain hunting really caught up. While reviewed here websites have satisfied the essential demand there are still opportunities to build on what’s accomplished. In addition I think the market penetration at this point is not yet high and new players (or old players with new ambitions) will have a good shot at grabbing a piece of the pie — a good example is the recent social revolution at JudysBook.