Ronnie05's Blog

Future of Local Commerce: Collective buying (Part II)

Posted in Industry updates by Manas Ganguly on March 20, 2011

This post is a continuation of the part one in the collective buying series and details the competition in the area of collective buying which now has the fancy big boys (Google, Facebook, Yahoo) joining the originals (Groupon, LivingSocial and Foursquare)

Facebook is planning to offer multiple deals every day, focusing particularly on activities that can be shared with friends, such are visiting restaurants and concerts. The strategy builds on the company’s existing Deals program, which is offered as part of Facebook Places. Facebook is testing a new discount service that allows people to buy deals on Facebook and share them with their friends. This then is FB’s most direct assault yet on local deals giant Groupon. FB is in a pilot to test this service in Atlanta, Austin, Dallas, San Diego, and San Francisco.

Google has recently launched a similar check-in deals service for Android smartphone users. Like Facebook, Google’s efforts borrow from the Google Latitude, Google Maps, Google Places and the Check-in app. Google’s move highlights its aggressive measures to target the intersection of local search and e-commerce in the wake of the company’s failure to acquire Groupon for $6 billion.

Yahoo Local on its part has partnered with Groupon, LivingSocial, Coupons.com and more than a dozen other companies to surface deals and coupons from restaurants, spas and local clothing shops. Users are prompted deals basis his profile and relevance of the deal to his online buying behavior. Yahoo and its partners would share revenue generated from any local business deals consummated by consumers through Local Offers.

With check-in deals, Google, Yahoo and Facebook have joined Foursquare in dipping their toes in the deep pool of mobile, local and social search. These efforts take advantage of the intersection of users conducting searches for local businesses from their mobile phones and get deals.

Foursquare is one of the old boys in this list and is looking to steer and stay ahead of the pack by introducing location-centric deals. Foursquare users have previously been able to see nearby offers from local merchants, but they had to hunt for them on a large list. Now the deals will be aggregated by locations which will make them easier to find. To make things better, Foursquare also has added a Analytics spin for its vendors. Foursquare Merchant Platform, now includes a gender breakdown of checkins, a breakdown by time of day and other data that the company hadn’t shared before. As previously, the program is free to vendors.

LivingSocial Instant Deals provide a platform for merchants to create deals and get traffic through their doors when they most need it, such as during slower business hours or when they have an inventory of specific items they’d like to move. While LivingSocial daily deals are live for 24 hours, Instant Deals will only be available for a much shorter time, for example a restaurant can gain some additional traffic by offering a special that’s available only between the lunch and the dinner crowd. The deal can be redeemed at the merchant’s place by showing the phone and the Living Social authorization message. In a report in December, LivingSocial said it brings in about $1 million a day.

Groupon may not have been the pioneer at Collective buying as a business(That crown belongs to LivingSocial).However, Groupon has made the most news bytes and has the best presence in US markets. Groupon registers 178 cities with deal-a-day sites reaching 102 million people in the United States. Groupon Inc. may go public this year and be worth as much as $25 billion in its initial stock offering. In trying to stay ahead of the herd, Groupon is not reported to be looking toward the enterprise space, with at least one coupon for IT services consulting in the mix.As with Foursquare, Groupon is also is pushing the envelope with geolocation technology, using hyper-local targeting to reach customers who might be within a few blocks of a client with coupons for, say, a lunchtime deal.

Social Networking, Mobile computing and Collective buying are natural siblings in the era of convergence and connectedness. The Collective buying space is growing fast and is quickly able to cater to both users giving them discounts and bargains they have been looking for and for local business men as well, who now have the ability to push products which are loosing their marketable prices at discount prices rather than booking losses on the whole stock.

Advertisements

2 Responses

Subscribe to comments with RSS.

  1. […] a comment « Oracle: Staking a claim at the Mobile apps pie Future of Local Commerce: Collective buying (Part II) » LikeBe the first to like this […]

  2. […] upto their high valuations. Groupon, is the forbearer of collective buying, a very potent concept.(read more about Collective buying).But irrational exuberance may bust the expectation bubble before it gets […]


Leave a Reply

Fill in your details below or click an icon to log in:

WordPress.com Logo

You are commenting using your WordPress.com account. Log Out / Change )

Twitter picture

You are commenting using your Twitter account. Log Out / Change )

Facebook photo

You are commenting using your Facebook account. Log Out / Change )

Google+ photo

You are commenting using your Google+ account. Log Out / Change )

Connecting to %s

%d bloggers like this: