Services, Products Or Both? The Dilemma Of Daily Deals & Products Sites

With the recent shutter-downing of e-com venture, many are asking philosophical question about the present & future state of the currently mushrooming online deals sites.

Comparing’s failure to the IT Bubble a few years ago, trade analysts, based on some recent findings,  seem inclined to relegate the same fate to the daily deals & discounts site that seem to launched almost everyday. However, market watchers, players and investors are optimistic & are confident that though the “market” will see some consolidation, it is far from its pinnacle.

We feel they are right  in doing so.

Well the answer may not be straight forward but let’s take a jab at it anyways. The basis of any successful business is doing one thing exceptionally well & keep doing it, rather than doing many things simultaneously & hope to do good. OR worse, abandon your forte & run after what others seem to be doing well. Taggle initiated with a US$ 1Million & offered Service deals. Subsequently, they realized, “they were not giving the best value to users” i.e. the site was generating enough revenue and they shifted to products-only segment & tasted some success. Guess, novelty played its part.

However, citing reasons like “many ecommerce players selling products at below cost price to lure users” that ultimately, “burned a lot of investor money ”, which went, “against our philosophy”, was “forced” to shut-shop.

Was it a case of missing the target? CEO of daily deals site Gaurav Kachru says, “This is a growing space; there is room for everyone. The daily deal sites have their own purpose and target audience”. This optimism is shared even by IAMAI which states Taggle doesn’t singularly represent the whole industry, “When a new sector emerges, there are winners and losers”, says President Subho Ray.

Starting just a year back already has a million users [a lot less than MyDala]. However, “Giving daily discounts is difficult” says Mukesh Bansal, CEO, as “Users will expect you to do so the next time”. With number of such sites (approx 400) coming during this year alone, we have yet to see mass exodus. “There is indeed “frothiness” in the way e-commerce companies are getting valued, but this time, the fundamentals are much stronger; e-commerce is for real” says Sanjeev Aggarawal, Snr. MD, capital firm Helion Advisors.

Do you regularly visit these Daily Deals & Products Sites? What are your experiences? Do share with us.

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