Group Buying is about to get a whole lot harder

We are about to see the genesis of Social Commerce. Underpinned by the familiar elements of Group Buying but driven by technology that will improve the relevance of offers to each individual and enhance sharing and reinforcement from the member’s own social circle.

Right now the barriers to entry are low for Group Buying, at Cudo we spent only $100k to get our Group Buying platform up and running, peanuts considering the opportunity available at the time. We have since spent many hundreds of thousands of dollars evolving the platform to become more intelligent, capable of optimising the offers presented to each member and we will continue to invest until we have a true Social Commerce engine.

A consequence of Cudo investing so heavily to evolve the experience  is the growing expectation of Group Buy-savvy consumers who are already weary of poorly matched offers landing in their inbox each day. We are seeing the beginnings of consolidation in the market, something I speculated on back in July.

But rather than that consolidation immediately resulting in a reduction in the number of competitors, we are seeing quasi “personal” Group Buying businesses emerge with niche vertical offerings and hyper local positioning instead. If successful they will steadily invest in the technology required to expand and compete, or become acquisition targets for the struggling mid tier clones instead.

Either way, there is a technology arms race ahead out of which Members and Merchants are set to gain!

I still think it will be fascinating to watch!

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2 thoughts on “Group Buying is about to get a whole lot harder

  1. Hi Billy,

    We built DealPinch.com in a weekend at Startup Camp with a total cost of about $20 if you don’t include the pizza and beer. Yes, no extra thousands there.

    A group buying platform can be built that scales to your level in a number of days for a few hundred dollars if you know what your doing. Is your main cost sales force and advertising spend?

    Over here at Deal Pinch, we localize, we categorize just so the group buying sites don’t have to, all with one simple email.

    This space is definitely fascinating to watch. Meanwhile, we haven’t heard back from you yet about getting Cudo deals up on Deal Pinch – they are in hot demand from our members, are you happy for us to go live with these?

    The Deal Pinch Team

  2. Howdy! This blog post couldn’t be witten much better! Looking at this
    article reminds me of my previous roommate!

    He continually kept preaching about this. I am going to forward this post to him.

    Fairly certain he will have a very good read. Thanks
    for sharing!

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