Group Buying

Group buying deals are here to stay in South Africa

Group buying (or social buying) is a brilliant way of bringing new customers into a company’s store, by simply creating a large-scale online and offline marketing campaign. It’s risk-free and follows a simple strategy: create a discounted deal to attract new buyers, and then aim to make them loyal to a new or existing brand.

For customers and consumers alike, it is also a wonderful way to try out new things in your city, which you may like and continue to use or buy in future.

Group buying for businesses

Many brands have tried group buying and through the results questioned how good the exposure was. Some have had brilliant experiences and others not – both in South Africa and worldwide. To make sure that you have a good experience in offering a deal, follow these principles.

1. Reference checks
If you employ someone, you take a reference on them to be sure they do good work. Similarly, you’re employing a group buying website to do a job for you. You don’t even need to tell anyone you are going to phone. All group buying sites have a section for “past deals” – click through and select a deal, preferably in your industry. Then call them and ask how the campaign went. The numbers sold are not always an indication of a good deal for all involved.

2. Get paid fairly!
A hotly contended issue on the internet currently, both in South African group buying circles and overseas. Group buying companies make their bucks by taking a portion of the income generated by the deal. So, a coupon sold for R100 will be split as per the group buying site’s fee, sometimes as high as 50%. This means that as a business, you’re entitled to R50, but it doesn’t mean you’ll get paid straight after the deal. Check what the payment method is, and negotiate or turn them down if they do not pay you at least something upfront.

Important to note, some sites only pay you on redemption, meaning that once customers redeem the coupons at your business, you have to show these to get your money. Avoid this like the plague – if a customer doesn’t redeem, you won’t get a cent and the group buying site keeps the full price. Also, you may need some of the money upfront to prepare for the influx of customers.

3. Buy a coupon
Get on the site you want to go with and buy something for yourself or a friend. This small investment will get you to understand their payment process and also how easy or difficult it is to navigate and use the website. Group buying is meant to be an easy e-commerce transaction, and if you get stuck, that can hamper the deal you are offering. Should anything go wrong, call their hotline and see how their support handles the call. Now try that number after hours to really test them.

Even going through the buying process up until filling in your credit card details and not actually buying will show you a lot of what your new customers would have to go through.

In essence, what a business needs to do is what they should do with any marketing provider – check them out and make sure they will deliver. Although numerous group buying complaints have been registered from consumers and businesses alike, most of the business complaints are because the group buying site is not adequately consulting with the business. Make sure they do, and your marketing campaign will flourish.

Group buying for consumers

Most online consumers will agree that late 2010 and all of 2011 has seen group buying as the latest craze to hit the Internet. The idea is simple and is in fact in use on a daily basis by large brick and mortar shops around the world and only in the last few months did it catch on online. In fact, according to Wikipedia, collective buying has been around with the Chinese forever.

Amidst all the growing of the social buying market in South Africa, there have been complaints and compliments, though in general the benefit for consumers has been amazing – super daily deals every single day delivered into your inbox. If you don’t like the deal, you don’t buy it, and if you do, you can enjoy something new. Perhaps you’ll like it so much that you end up a loyal and happy customer. If you wish to stop receiving the emails – you simply opt out and you can always join later again.

Tell us below about your opinions of group buying, and which sites, deals and experiences you have both enjoyed and possibly not liked.