Group Buying Online
Friday, August 10, 2012
The latest craze in online shopping is group buying online. The concept is a pretty easy one. Companies can advertise a product or an item at a discounted price and then hope to achieve high sales on that item. A selling company then advertises that item and if a set number of people (decided by the original company) buy the item, then the whole group benefits of getting the item at a drastically reduced price.
There are many of these selling companies (deal of the day, living social, groupon, wag jag, dealfind, buytopia, go low, good news) and they offer a daily deal with a set number of people that have to buy the item and a set time that the sale item will be offered for (typically 24 hours). An email is sent out to those that are registered (for free) each day advertising each item.
So what kind of products can you expect to be sold? Everything from clothing, to spa treatments, restaurants and retail stores.
How does it work? Deals come out for discounts from 50-90% of the original price. For example, a restaurant might advertise a deal for that if you buy the item for $25 you will then get a meal worth $50. It’s a great way to make fast business and a great way for the consumer to save money.
These deals don’t necessary have to be local. The travel industry is now advertising deals with the group buying online and you may be able to get a great deal for travel ($1000 voucher for $2000 of merchandise).
Merchants and consumers alike can benefit from group buying. It gives merchants a chance to make quick business and move inventory, and it allows consumers to bargain hunt and get a very good deal (if it was something that they were going to buy anyways!). Merchants also benefit as their company is being advertised, and if their deal is great, consumers will tell other consumers attracting more business to their location.
Be wary though! As a consumer, it’s easy to get caught up in a “good deal”, and you may end up buying things that you may not need due to the fact that it’s such a great price. Also, make sure that you read the fine print for your deal. Groupons are notorious for expiration deadlines (other companies deals never expire).
Happy deal of the day!