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Facebook Deals, Google Offers, Living Social: Who Win Group Buying?

Fef 2011/04/28 23:19:34
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Heard of Groupon yet? Yeah that company that sends everyone emails with discounts on everything from spas, manicures, restaurants to bike shop repairs and teeth whitening. Well they shot out the gate of group buying and have grown gangbusters in size and revenue. But with success comes competition. Who will win the group buying frenzy?

Groupon gets credit for starting the successful group buying craze in the United States, but Groupon's roots trace back to China:
Group buying, also known as collective buying, offers products and services at significantly reduced prices on the condition that a minimum number of buyers would make the purchase. Origins of Group buying can be traced to China[citation needed] where Tuángòu or team buying was executed to get discount prices from retailer when a large group of people were willing to buy the same item. In recent time, Group buying websites have emerged as a major player in online shopping business. Typically, these websites feature a deal of the day, with the deal kicking in once a set number of people agree to buy the product or service. Buyers then print off a voucher to claim their discount at the retailer. Many of the group-buying sites work by negotiating deals with local merchants and promising to deliver crowds in exchange for discounts.
http://en.wikipedia.org/wiki/Group_buying

Groupon has done very well, but its success prompted a group buying craze with the big boys, including Google and Facebook.

Facebook launches Deals service in challenge to Groupon and LivingSocial
Facebook has begun testing the daily deals service in five cities. It lets users save money on discounted deals and share their shopping expeditions with friends on the site...
Groupon turned down a $6-billion buyout offer from Google late last year and is said to be planning a $25-billion initial public offering of stock. This month, Groupon hired a Google executive to be its chief operating officer.

The daily deals market is expected to grow to $3.93 billion in 2015 from $873 million last year, according to BIA/Kelsey, a Chantilly, Va., consulting firm.

http://www.latimes.com/business/la-fi-facebook-deals-20110427...

After Google failed to close its offering with Groupon, Google launched a similar service called Google Offers:
Get amazing deals of 50% off or more at the best places to eat, shop and stay. Subscribe now and you'll get offers in your inbox when Google Offers launches
http://www.google.com/offers

Interestingly, Microsoft started a group buying effort back in 2000, but failed:
In 2000, with financial backing from Microsoft co-founder Paul Allen, an e-commerce start-up called Mercata hit the market with a business plan it dubbed "We Commerce." The website offered high end electronic deals deals to shoppers online.Individual Web shoppers would sign up en-masse to buy the same product, and the price of the product would fall as more people signed up to buy it.However, the website was shutdown in 2001 as it could not compete with websites like amazon.com.
http://en.wikipedia.org/wiki/Group_buying#cite_note-2

Read More: http://www.latimes.com/business/la-fi-facebook-dea...

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Opinions

  • Stan Kapusta 2011/04/30 06:24:20
    Everybody Wins!
    Stan Kapusta
    you don't have to buy what is offered. But it's nice if you can use it.
  • misterz 2011/04/29 17:36:22
    Groupon
    misterz
    Started here in Chicago.
  • Riobhca 2011/04/29 03:13:32
    Groupon
    Riobhca
    They've seemed to be about the best so far.
  • alw_ays 2011/04/29 03:12:57
    Groupon
    alw_ays
    If you turn down an offer from Google and you're still kicking, I'm betting you've got the market cornered and aren't going to have a problem keeping with it. Failure will come from within for this company.
  • Torchmanner ~PWCM~JLA 2011/04/29 02:37:12
    Groupon
    Torchmanner ~PWCM~JLA
    I can see it.
  • CoolStoryBro Bn 0 ;) 2011/04/28 23:22:51
    Everybody Wins!
    CoolStoryBro Bn 0 ;)
    +1
    Equal distribution, maybe?
  • Fef CoolSto... 2011/04/28 23:33:44
    Fef
    +2
    Advertisers will have to pick which service they use. I don't think they can afford to use each service at the same time. However, maybe enough advertisers exist to distribute the wealth.
  • CoolSto... Fef 2011/04/28 23:37:24
    CoolStoryBro Bn 0 ;)
    Okay. :)

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