Jumponit Makes $24M/Yr, Scoopon Being Sued by Groupon, Groupon to Come into Market

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  zhen_clickdeals on 14/09/2010 - 17:41

  I saw the Groupon parked page the other week and knew they were heading for trouble with the splash page they had up. Will be interesting to see the outcome and if the trademark/copyrights have any reach into Australia.

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  swimmingtoad on 14/09/2010 - 18:28

  Thats only $24m in revenue though, i wonder what profit margins they have…

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  [Deactivated] on 15/09/2010 - 08:43

  COTD also has dealextreme.com.au registered under and redirected to them, so they probably have other competitors registered under them as well.

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  huntress_love on 15/09/2010 - 13:26

  that's interesting, i didnt think jumponit was the biggest player or the first on the market.

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  scotty on 15/09/2010 - 22:45

  No Jumponit is definitely not the first player on the market in Australia, however the interview + Delimiter article claims that they are probably the biggest at the moment (based on their Facebook fans I guess :)

  Also note many are also foreign entities coming to Australian market. LivingSocial and Ouffer for example. Many are also well funded by investors to allow them to quickly establish themselves in the market, i.e. they have deep pockets for advertisement + development.

  Anyway. Sounds like a bubble to me. Let's see how many of them are left by this time next year.

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  scotty on 17/09/2010 - 12:25

  +2

  Saw this article this morning. A story of a business (Posies Cafe in Portland in this case) loosing money by advertising on Groupon.

  http://posiescafe.com/wp/?p=316

  Groupon actually asks for 100% of revenue when sale is under $10. Although the vendor negociated to 50%.

  No wonder there are so many copycats around the world. I too thought they'll probably ask for 5-10% of the cut. But 50% or more?! How would business survive if their group-buy campaign actually becomes popular?

  Maybe some vendors can share their experience with the Australian group-buy sites?

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    neil on 17/09/2010 - 13:46

    Interesting read. I guess it's dependent on the business. Service industries such as massages and personal training have lots to gain but industries where the markup is small may have more a difficulty.

    I am seeing a lot of the same venues advertising on these group buy sites, so it appears that may be working a bit. I wonder if the venues sign non disclosures when they agree to sell on these sites.

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    swimmingtoad on 17/09/2010 - 17:38

    Very good link and read! Thanks for posting..

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    retiredfeline on 21/11/2010 - 20:28

    Interesting read, thanks for the link.

    I'm not keeping stats, but it feels like the mix of offers in my inbox has shifted away from food and drinks towards services: massages, hairdos, that sort of thing. Maybe the food businesses are discovering the drawbacks of group buy sites.

    Only a small proportion of the food businesses I found memorable enough to consider another visit at full price.

    PS: It occurred to me that services do better than food with the group buy model because their work is spread out over the day, and you can ask customers to make appointments whereas eating is concentrated around two or three periods a day and hungry customers turn into irate customers quickly.

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    BuyoTheCat on 22/11/2010 - 20:57

    100%? i thought only fat tony works off that business model

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  neil on 21/11/2010 - 20:06

  Interesting, according to Techcrunch, Livingsocial which has launched in Sydney has bought Jumponit. Guess we just wait for Groupon although with 11 of these sites running in Sydney and 12 in Melbourne, is there room for another?

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    scotty on 21/11/2010 - 22:28

    I think this space is very packed.

    All they want is to be acquired by Groupon, who themselves are hoping to be acquired by Google.

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  me on 22/11/2010 - 08:18

  I was speaking with a restaurant owner who had an offer with one of the group buy sites over the weekend. They told me they'll never do it again…said that in addition to fees paid the way it works is this: customers buy coupons and redeem them in store. The restaurant then has to keep all these used coupons and 'redeem' them with the group buy sites (thus the need for 'unique barcodes' etc. Any redeemed coupons that are lost is like money that is lost: without that coupon te site won't give the business the money. Apparently its quite easy to lose bits of paper in a busy restaurant - which might explain the higher frequency of beauty deals: calmer, slower environment where you're less likely to lose thongs.
  Oh, and any unredeemed coupons (based on statistic, about 33% apparently) the money goes to the website, not the business.

  Now I don't know that all these sites operate the same way, but, for this business at least, in hindsight it wasn't worth it (though I can see why businesses would be easily sold on the idea, especially if they were struggling.

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    cloudy on 22/11/2010 - 20:08

    mind telling which group buy website serviced this resturant?

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    illusionarybreeze on 22/11/2010 - 21:43

    hmm…that's very interesting. Never really thought about how these deals work.

    btw, I assume you meant "things" as opposed to "thongs" =D