A business model approach towards the understanding of daily deals within Internet distribution systems

Abstract

The business model approach is making a slow, but steady footprint in tourism research, and can offer a fresh perspective and a viable level-of-analysis for broader networks of internet distribution systems. Among those, the researchers have devoted limited attention to studying the daily deal providers and their position next to the online travel agencies. More importantly, the daily deal providers developed a unique business model whose characteristics, contrary to early predictions, enabled them to proliferate post-recession and maintain their position. The current study uses the business model approach to observe the original dimensions and business model elements, to identify distinct characteristics of generic and niche daily deal providers, and to benchmark them against the established online travel agencies. The business model approach enhances the understanding of the overlooked niche daily-deal providers in internet distribution systems. Further, the paper provides a comparison of the distinct business model characteristics in internet distribution systems to help facilitate the formulation of a unique value proposition for each of them. Ultimately, the authors acknowledge limited possibilities for cooperation between the providers and discuss substantive directions of daily deal and internet distribution systems business model transformations of the future.