Up until now, “connecting” was all about web 2.0. Initially, the connection dynamic was created through Facebook, Twitter, LinkedIN, Flickr, Delicious, Buzz, Myspace and a myriad other social media. Then, when in mid 2008 Groupon launched in Chicago, the next big thing in the tech world was something called “Group deals”, a service that basically helps increase one’s spending power. Although the origins of social buying can be traced to China where Tuángòu was created to get discount prices from retailers when a large group of people were willing to buy the same item, it is the US based start-up that skyrocketed interest in this new trend.
Ever since, group-buying businesses such as Living Social (Groupon’s main competitor) started flourishing all over the world. In Greece alone, approximately 80 group-buying sites sprang from almost nowhere, now offering all kinds of deals, from nail polishers to spas or travel deals. Throughout the world, leaders nowadays include among others Groupon, LivingSocial, Plum district, or BuyWithMe, with hundreds of different versions in different languages and different countries.
The big Internet “dinosaurs” would not have stayed outside the game. As a matter of fact, big players such as eBay are now building their own deal sites. A couple of months ago, Google announced it would start its own daily deals site called “Google Offers” after its $6 billion acquisition offer to Groupon was rejected. “Facebook deals’” application was also launched in some European countries in early 2011.
This is getting big. But what is social buying after all? Group buying or “social buying” sites feature a deal of the day, with the deal kicking in once a set number of people agree to buy the product or service. Once the deal reaches a set number of customers, all the users receive the deal. If that number isn’t delivered, then the business doesn’t pay for the service, the customers don’t get the deal and the group-buying site doesn’t profit.
But if that set number is reached, then all buyers receive a voucher to claim their discount at the local store or retailer. Almost no exceptions made, intermediaries (the website) charge vendors a percentage fee in the range of up to 50% of the total value of the whole deal. New players trying to lower their barriers of entrance could charge as low as 20% or even 10% to increase their competitiveness.
So then, what about products? And most important, what about products, services, trips or any other kind of deals YOU care about? Personalized interfaces and content being the last step in ICT and web refinement, the next big bet is all about personal preferences and tailored deals. Let’s simply call this “smart” deals.
tipaizei.gr (its English translation would be something like “what’s up”) is the first group-buying social network in Greece and eventually Europe all together. Their philosophy? Create a Facebook-like community that instead of LIKING pictures, will LIKE deals. Rather than the usual top-bottom approach most group-buying websites rely on, tipaizei.gr uses a bottom-up approach. Instead of suggesting offers to customers the platform allows visitors, fans or simple members to create their own deal. Anyone can upload a “deal idea” on the platform. All members of the tipaizei community then vote on the idea, using a digg.com-ish looking philosophy. At the end of the week, the founders of tipaizei create deals for the ideas with the most votes and place an open offer with the new, cheaper price on their own website for members to buy.
Although tipaizei.gr is only available in debt-burdened Greece, there are already rumors in the Greek market about expanding to other Balkan countries. A mobile app is on its way, and “tipaizei it!” web 2.0 buttons are expected to make their appearance on multiple sites on the greek web, from travel agents to online retail shops. Thus, with a simple click on the “tipaizei it” web 2.0 button, the description of the service or product will be automatically uploaded on the tipaizei.gr platform for members to review and vote on.
Creating a digital form of personalized shared intelligence could help gear normally diverging consumption preferences toward one specific target, based on individual likes or dislikes. The model helps cut overhead costs since the regular group buying representatives who try to dig in for deals and negotiate with vendors are actually the website members or visitors themselves. Also, it allows for excellent scalability and growth. A good way to increased Greeks’ spending power while engaging in e-activism? Time will tell.Author : Loukas Germanos