The excitement in the daily deals space is just starting to build it seems. We always were of the idea that local search/listings players should enter the Groupon clone model and the first player to jump into this is BuzzInTown.
Local events listing site BuzzInTown has launched a deals section featuring discount vouchers of restaurants and other lifestyle needs. The site currently features deals from Bangalore, Delhi and Mumbai. While there is no differentiator in the offering as compared to other clones but this move does make complete sense. A mix of content and deals is good to be able to sell without spamming the users as the users now have a reason to come to the site and the deals are eye catchers for an impulsive purchase.
Meanwhile, SnapDeal has launched a Getways vertical exclusively for holiday deals. SnapDeal is the biggest deals site in terms of traffic and owing to the heavy marketing expenditures they recently entered the Alexa top 100 (the hall of fame).
What i have learnt from few employees of some of the deals sites doesn’t sound very pleasant. Some are running out of cash and are looking for distress sale or changing the business model. The user acquisition cost doesn’t sound like they have an internal marketing team but rather outsourced the marketing to a bells-and-whistles online marketing company that generally large companies approach for one off campaigns.
The whole problem with this internet business model is the lack of friction to enter. You need a payment gateway and done. No body looks at the quality of the deals that is being hosted or how/why the traffic is going to come to the site. It is almost entering the blogging model. It is easy to set a WP blog and then all you have to do is post content. In few days you see no traffic coming and then abandon the blog.
If you are looking to join the party, make your own Groupon clone for as low as $89 (see the list of Groupon clone scripts).
Lets us know your views on this most talked about business model of they year.
[Naman is a startup enthusiast and has worked with couple of Indian startups as Product Manager. He is the founder of FindYogi]
