It was interesting to read Mashable's latest on Groupon's international expansion:
Groupon Goes International, Buys Japanese and Russian Clones
When I was in Shanghai last month, it was interesting to hear that more than 400 Groupon type sites popped up in China in the last couple of months and already, the larger ones were acquiring the smaller ones over there...
(sure is a dog eat dog world!)
In Japan, I think Piku led the way, quickly followed by other Groupon clones.
And when Recruit, who publishes restaurant guides and coupon magazines that retailers and service providers PAY to get on, launched their own site, they really upped the game.
They already had the procurement channels.
It is obvious that the site structure is very basic, and without the need for product shipment, the procurement of services is key and having the right sales force to do it is the only entrance barrier to launch this business.
Of course, marketing is also important, and getting the viral buzz going is imperative, but that is really a core business activity, and one that can be accelerated once the daily deals offered generate marketing for themselves.
I think Piku's first boost came when they did the "2,000 yen ($20) pizza voucher for 500 yen ($5)" deal.
And that was their first real "national" campaign.
Once the procurement allows, the speed with which such sites expand into cities outside of Tokyo is a key driver of overall revenue.
In the brick and mortar world, even late-comer (they came after Top Shop, H&M, Forever 21, Gap, etc.) Abercrombie & Fitch is planning on setting up their 2nd store in Fukuoka, not another location in Tokyo, or the 2nd largest city, Yokohama.
How fast these Groupon businesses can populate other high-concentration commercial centers will really be the next thing to watch. Think: Nagoya, Fukuoka, Osaka, Sapporo, Sendai and of course, Yokohama
Another thing, perhaps to watch, is how the likes of Gilt are moving into this space, too, as they, too, have the flash sale model.
Gilt has started selling concierge service memberships and Starbucks deals - moving more into the Groupon type space, so the business models are converging and clashing!
Need to watch this space!
Also interesting to read on Mashable:
Target to Launch Flash Sale on Gilt for Fall Designer Lines