I like teeth whiteners, Middle Eastern cuisine and laser hair removal just as much as the next person, but group shopping is clearly—and quickly—losing its appeal.

Competition has grown drastically with new daily deal sites launching, well—daily. The novelty previously enjoyed by Groupon, Living Social and Gilt has become commonplace with an uprising of new daily deal sites from ideeli, Amazon, PopSugar, HauteLook and more. With their persistent emails and repetitive, banal offers, consumers are overwhelmed and beginning to lack interest in daily deals.

Last week, AdAge reported that Yelp will scale back it’s daily deal program, while Facebook made a similar announcement only days earlier by announcing plans to discontinue Deals,
its daily discount program, only four months after it launched. And signaling even greater consumer fatigue, Mediapost recently reported that Groupon traffic has declined by nearly
50% with TechCrunch predicting it’s imminent collapse.

According to The New York Times, most flash sale sites remain unprofitable. And perhaps even more devastating to the business model is that small businesses are beginning to discover that discounting doesn’t necessarily translate to new customers. Many small businesses, typically without a significant marketing budget, look to daily deal sites as a fast way to promote their business and attract new customers. In their quest to drive sales, they offer their products and services at a discounted price—all too often, too discounted—while failing to focus on their brand. Even if the promotion surpasses expectations, owners are inadvertently placing their business at risk if the deal exceeds immediate product availability or creates scheduling delays. Further, acquisition doesn’t equal retention. Small businesses are finding daily deal customers often equal one-time customers.