After having taken most of America by storm with social shopping, daily deal giant Groupon Inc., is bringing the same concept to India. Unlike some other Asian countries where online shoppers continue to experience the online group coupon concept through copy-cat local companies, Indians will actually get to experience the real ‘Groupon’. Groupon Inc. is throwing its ring into the Indian arena, by launching across 11 Indian cities, with a new brand identity and some technological upgrades.
Groupon has taken over SoSasta.com and has changed the hinglish (combination of Hindi and English) name, meaning ‘So Cheap’ to Crazeal.com, presumably, a combination of Crazy and Deal! Crazeal will open up for shoppers in cities with major spending power but also ever appreciative of discounts – Ahmedabad, Bangalore, Chandigarh, Chennai, Delhi, Hyderabad, Jaipur, Kolkata, Mumbai, Nagpur and Pune. Soon they intend to expand to cities that fall in the ‘tier-2’ rung in India, essentially, small towns that are rapidly urbanizing. Given Groupon’s core proposition, of offering lifestyle deals, like discounts on restaurants and spas, particularly high-end ones, it will be interesting to see how the company expands growth at tier-2 levels. Crazeal.com, according to various media reports, will also be active in the area of travel and shopping for electronic goods, branded clothes and holiday packages. Given Indian’s unique online marketscape, Crazeal will sell a range of goods, from pens to soft furnishings – very unlike its American counterpart.
The concept of social shopping might be Groupon’s very own, but it is sort of a late entrant in the Indian market, considering some 20 clones exist already, having rapidly set up businesses with the same model. Expectedly the early mover that has made the bucks and kept the customers, Snapdeal.com, among the earliest to set up operations in the country, has some 8 million registered members and operates in 50 cities across India. Further, it has also recently raised as much as $40 million from venture capitalists. This, in excess of the $12 million that the company raised earlier in the year!
Crazeal’s numbers in this regard are hazy. Groupon acquired SoSasta for an undisclosed amount and it is not public yet, how much Groupon Inc. is investing in its Indian arm. Incidentally, SoSasta was the fourth Indian daily deal company with the most unique visitors, according to internet research firm, comScore’s recent report. Not surprisingly, Snapdeal has the most impressive figures with some 1.47 million visitors each month, followed by other sites Dealsandyou.com and Mydala.com, which has 99,000 and 952,000 unique visitors respectively.
The spurt of daily deal sites, in addition to other online shopping sites like ebay India and daily fashion deal sites, like Fashionandyou.com, is an acknowledgement of the growing e-commerce market in the country where millions don’t have internet access. Which is why, growth in sector, in the country, was, considering the global scenario, very poor. It remains to be seen how much these sites will be embraced, and how the unique visitors numbers are translated to sales and profits.
Like Groupon Inc., which has been embroiled in speculation and also investigation, Crazeal has had its own share of teething troubles and litigation. Online business security site, Risky.biz, had revealed earlier in the year that SoSasta’s database has been leaked on the internet. While denying the breach of sensitive information, Crazeal is adopting Groupon’s more secure global technological platform. The original founders of SoSasta have also exited the Board, which some said, led to the rebranding of site – a speculation denied by the company. In addition, Crazeal or should we say, Groupon Inc. is fighting a legal battle with Bangalore-based firm, ValueNet Ecommerce Pvt. Ltd, that had registered the domain name, Groupon.in way back in September 2009. Clearly, a copyright breach!
Amidst all the speculation and expansion, Groupon’s initial public offering in the US, has received massive attention, and has been compared to public offerings of Google and also Facebook’s impending offering in late 2012. The company intends to raise $750 million. Will some of it go to Crazeal? Will Crazeal prove worthy of the attention and resources? We’re poised to find out!