Ian Duncan

On a recent afternoon, Sumana Ramakrishnan, a 21-year-old student with her eye on a pink frosted cupcake, stepped up to a cash register inside Butter Lane and reached into her pocket. But instead of pulling out her wallet she tapped on her smart phone and showed it to the knowing cashier. There would be no charge, it turned out, for Ms. Ramakrishnan’s cupcake. Hers was one of more than 800 that had been given away in February by means of a promotional website.

The site, Tenka, is among the newest of a host of such sites seeking traction in the East Village. It was started in October by Nhon Ma, a former Google operations manager, who said he targeted the East Village because of its density of small businesses and population of Web savvy young people.

“The East Village is fiercely competitive relative to other areas,” said Mr. Ma. “Tenka deals really resonate with merchants because they are able to see the power of social recommendation.”

Tenka is a cell phone-based online service that lets customers redeem coupons for free items at participating stores. Tenka charges merchants to create a deal. The merchant chooses how many coupons they want to offer, and Tenka promotes it on its site and across its users’ Facebook pages.

Many of the small business owners who turn to deal sites, and other forms of social media, do so because they don’t want to spend money on other forms of advertising.

“From the beginning our strategy was, what kind of marketing can we get for free?” said Maria Baugh, co-owner of Butter Lane. “Having no marketing budget, a lot of social media opportunities were great for us.”

Ms. Baugh and her business partners signed a lease in July 2008, just prior to the Lehman Brothers’ collapse, and panicked that they would struggle to make a success of the bakery in the chilly economic climate. Fortunately, Ms. Baugh said, a whole new world opened up at their feet. Twitter was just taking off and Facebook was becoming available to the public.

Today, Butter Lane has over 1,400 followers on Twitter and more than 2,700 likes on Facebook. Combining those with e-mail, Ms. Baugh estimated she can instantly get a message to 10,000 people. That is useful, she said, when the bakery has a last-minute cancellation at one of its cookery classes and wants to fill a spot. Users of Foursquare, a service that lets smartphone owners broadcast their location to friends, will get a free cupcake every tenth time they visit the bakery.

For Bill Tatton, who is Butter Lane’s Foursquare Mayor or most loyal customer, feeling connected is important.

“I am a fan of making the consumer feel like they are a part of the success of a local business,” said Mr. Tatton, communicating via Facebook. “When we are excited to share what we know about a store, it has a great snowball effect.”

But can Foursquare postings or Twitter messages translate into revenue?

Alexis Lamster, the vice president of customers at Postling, a service that helps small business owners manage social media, agreed that services like Twitter can help build a community following. But she also said that some of the increasingly popular daily deals websites, such as Groupon, can also present a risk for small businesses.

“They aren’t sure what the value of doing a daily deal site is,” Ms. Lamster said. “Groupon is good for getting cash up front but it makes it hard to predict cash flow, and the whole process can be very expensive.”

By giving stores a way of offering attractive discounts, Groupon can lure in new customers, but the site takes a hefty cut from any sales its generates.

Still, Ms. Baugh sought out Groupon as soon it was available in New York. So far she has had success with the site, she said, but added that using it effectively required careful preparation with her staff.

“It was massive and we had a couple of crazy days,” said Ms. Baugh. “But we turned on new people to Butter Lane, so it was successful.”

Meanwhile, in between bites of her free cupcake, Ms. Ramakrishnan conceded that it was her first visit to Butter Lane, and that should would definitely return if there was another Tenka deal — but not without one. She said that does not like to splurge on food in the city because it’s too expensive.

“I really like getting great deals and free food, like everyone else, and the best part about it is that it’s so unbelievably easy for the customer,” said Ms. Ramakrishnan. “All I need is my iPhone.”