Big group, small price

Group buying is the latest online trend offering big discounts on leisure activities and at eateries, a first in the country.

Chandralekha Mukerji | Print Edition: December 2010

You may have honed your bargaining skills at the snootiest of shops, or if you are blessed with a Netsavvy gene, you would have trawled numerous discount sites. But have you managed to extract a 90% discount at a restaurant or snagged a spa treatment at half rate? In all probability, no.

Well, now you can, thanks to a simple online concept called 'group buying'. In the past year or so, e-shopping in India has undergone a makeover with the launch of several group-buying Websites. Here's how they work: consumers find deals on such sites, sign up, wait for others to hit on these within a stipulated time and get cut-rate products and services.

One can get discounts ranging from 40-95%, with the most popular categories being restaurants, gyms and salons, besides niche options, such as dancing lessons, body art and adventure sports. On an average, at least one such city-specific deal is offered every day.

It's a win-win deal: while the customer gets a big discount, the local businesses and manufacturers get an assured number of customers and a parallel channel to advertise, while the Website typically earns a commission.

So far, none of the Indian sites, unlike their western counterparts, had offered bulk purchase concessions and discounts for leisure centres and eateries.

Now, you can have deals such as a flat 51% off at 34 Chowringhee Lane, a Delhi-based fast-food chain, by dealsandyou. com. The Website managed to sell 1,043 vouchers. Another deal by mydala.com offered a 97% discount at Body Sulpture gym in Delhi, with the site selling as many as 288 vouchers.

These portals are already high on the popularity charts and have a mass following on social networking sites such as Facebook and Twitter.

"The approximate worth of the retail services market in India is Rs 4,05,000 crore. Given this fact, once these discount sites offer online distribution to the small and medium enterprises (SMEs), the business that can be generated is tremendous," says Kunal Bahl, CEO, Jasper Infotech, which owns Snapdeal and Grabbon. This site claims to sell one deal every minute and has the widest geographic spread among its contenders.

Attracting Customers

Almost all the sites plan to expand their businesses soon. "Initially, we targeted young, urban consumers, but now we'll also aim at the tier 2 and 3 cities, where the Internet penetration is high but organised retail is not. This will allow us to offer this preferred source of purchase," says Ranjith Boyanapalli, co-founder, buytheprice. com.

As the basic idea and site layouts are roughly the same, these portals have devised unique deals and features for the sake of product differentiation. While buytheprice. com is a good place to find discounted electronic items and has a 'shopping assistant' to give you best purchase options, groffr.com is the only site to offer group deals on real estate and automobiles.

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