Groupon raising close to $30M triggered its clones to emerge globally, there is a groupon clone in every continent barring Antartica. Groupon clones in UK, Russia and Germany have successfully raised capital from VC firms, question arises here will Indian clones can also taste the success like their european counterparts.
Lets look at the grouping portals in India – Grabbon, Koovs, Mydala, Snapdeal, Wanamo, Mobstreet, BindaasBargain.
In my view Groupon clone should feel highly fortunate if they able to raise funds and bring in VC to their board.
a) No clear differentiating factor – There is no stand out and clear differentiator, every clone works in same way, only differentiating factor i see is location/city they are serving and some clones are justifying the distinction on the basis of numbers of fans in their respective facebook page.
b) No entry barrier – One really don’t need any extra skill sets to come out with one more version of clone, with the help of 2-3 developers and 1lac of investment one can up and run the clone. Absolutely no entry barrier.
c) Deals aren’t lucrative – None of the clones are focussing on a particular vertical, most of the deals are related to restaurants, weekend package, spa etc. Interestingly none of them are focussing on the lines of Nimblebuy, its also a groupon clone founded by my ex CTO at Andale Prashant Nendungadi , it deals only in electronic items.
d) Lean Profit margin – how much margin grouping site makes on each deal? my view is somewhere around 10-15% and additionally they would be taking a flat fee as advertising charges from the merchant. So if a grouping site sells close to 500 deals then they are doing some business which may attract a VC, but unfortunately they tend to sell on an avg 25 deals/day.
so what do you think about Indian grouping sites, share your views.