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There's a reason the deals on Groupon last only a day.

Your argument applies equally to Gilt, but I don't think people are going to start paying less for Diesel jeans.

Gilt and its clones don't sell regular merchandise, but almost always out of season, overstock, and seconds merchandise that the firm would have to dispose of regardless. Businesses that use Groupon deep discount their normal stuff.

Yes, but the reason these brands weren't doing this before Gilt was because they were afraid selling excess inventory at a discount would associate their goods with that lower price-point.

Gilt gets around this by maintaining a semi-private space and having one-day sales.

Groupon isn't private, but it's time-constrained in the same way and for the same reason.

If I know a sale is on for one day only, I'm going to understand that the deal doesn't represent the every-day price.

Besides, we're in the middle of a huge recession. Damn straight people are price sensitive!

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