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Global Players Heat up the Indian Group Buying Market

Binu T Paul
Tuesday, May 3, 2011
Binu T Paul
As the purchase on the internet is becoming more acceptable to masses across the country, online shopping is increasing in its popularity in a very fast pace. The extensive use of internet by the young people and its spread to the middle class has accelerated the growth of group buying industry in India and the discount deals through coupons.

These sites partner with local restaurants, shops, or other retail businesses which are willing to provide large discounts on condition that their name is spread to a number of new customers. Once a minimum number of people sign up for the same offer, the deal is confirmed and a voucher is sent to their inboxes. According to smartmoney, by August 2010, there were more than 500 group-buying sites worldwide, including local sites that cater only to a single city in some instances.

India’s fledging online discount coupon market is set to soar as it is said that Indians spend nearly $100 billion a year on discretionary retail services and migrating even as low as two percent of those spends online, it’s a $2 billion market.

Groupon is said to be the global market leader in the online group buying industry and the company has raised $950 million (`4,294 crore), online seller of discount coupons. The website has made a grand entry into the Indian market with the acquisition of three Web-based firms including Kolkata-based SoSasta.com. Groupon had recently turned down a $6 billion acquisition offer from Google. The Chicago-based website’s success has spurred much of the action in the group buying arena with countless competitors and clones coming up in Europe and the United States.

Snapdeal is the Indian market leader and the website offers deals covering all the major cities like Delhi, Mumbai, Chennai and Bangalore. The website provides vouchers and discounts at a reduced price with its tie-up with the various business partners.

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