The document discusses using Magento for an e-commerce site with features similar to Groupon. It outlines some problems with the Groupon business model, including high commissions and an inability to secure customers. The presentation then proposes using Magento to build an e-commerce site that addresses these issues by charging merchants for advertising rather than a commission on sales, and by helping merchants directly interact with and secure customers.

1. E-commerce
and
Groupon-like with Magento
Nguyen Vu Hung, HanoiLUG
2012/01/
AITI-APTECH, Hanoi

2. Agenda
1. Self Introduction
2. Business Model
3. Revenue Model
4. Views of Sellers and Buyers
5. Groupon-likes in Vietnam
6. Groupon-like with Magento
7. So, what are the problems
8. Related topics
8. A New Business Model
9. Q&A

3. Agenda (2)
1. Self Introduction
2. Business Model
3. Revenue Model
4. Views of Sellers and Buyers
5. Groupon-likes in Vietnam
6. Groupon-like with Magento
7. So, what are the problems
8. Related topics
8. A New Business Model
9. Q&A

4. Self Introduction
● A FOSS activist
● Offshore software development
● System Adminnistrator
● High Availability Engineer
● 2 years working with Magento
● About to start a new business with Magento

5. Overcharged
GROUPON BUSINESS MODEL
Can not secure buyers
Customer signs
with Groupon
Deal reaches
critical mass
Customers
pay
Groupon
Groupon Customer
features redeems
deal coupon at
Merchant Groupon pays merchant
signs up merchant share
Payments spread out in 3
installments over lifecycle
of deal, leading Groupon
Notable sources: with negative working
capital
http://primitus.com/blog/whats-the-secret-success-of-groupon/

6. A BETTER BUSINESS MODEL ●
Customers show “coupon” at
merchants to get discounted
●
No payment needed
Customer signs
with Groupon
Deal reaches
critical mass
Customers
pay
Groupon
Groupo Customer
n redeems
feature coupon at
Merchant s deal Groupon pays merchant
signs up merchant share
Payments spread out in 3
installments over lifecycle
of deal, leading Groupon
Notable sources: with negative working
capital
http://primitus.com/blog/whats-the-secret-success-of-groupon/

7. NEW REVENUE MODEL
Customer signs
with Groupon
Deal reaches
critical mass
Customers
pay
Groupon
Groupo Customer
n redeems
feature coupon at
Merchant s deal Groupon pays merchant
signs up merchant share
Payments spread out in 3
Revenue = Advertisment. installments over lifecycle
of deal, leading Groupon
Notable sources: with negative working
capital
http://primitus.com/blog/whats-the-secret-success-of-groupon/

8. Business Model Keypoints
● Free on submission for merchants
● Pay for top posting
● Social marketing
● Printed/Mail/SMS based scout/discount
● Directly sent to user’s email
– OSOS takes no commission, cheaper for customers and merchants
● Product Review
● Users’ feedback (non-biased)
● Feedback ranking, lottery for writing feedback (coupon?)
● Prefecture-based
● Service classification
● Monthly discount/lottery
● “User-only price”

9. ECONOMIC CHARACTERISTICS
Negatives Plusses
• Lack of network effect • Brand
• No technology barriers to entry • Economies of scale (‘winner takes
• No switching cost for merchants most’)
and customers
• Scaling is expensive (sales people
on the ground)
• High cost of customer acquisition
Notable sources:
http://techcrunch.com/2010/10/17/why-groupon-is-no-ebay/

10. Seller's views
●
Benefits (compared to Groupon)
●
Online marketing cheaper than Groupon
●
Be able to manage its own customers
●
Mail marketing
●
Networking with its customers
●
Easy to scale (using existing users)
• Groupon
– Merchants pay commission on posting
• New Business Model
– Merchants pay advertisement: top-posting, banner

11. MERCHANT PERSPECTIVE ON CUSTOMER INTERACTION
Get customer to follow on
Ad.
Get +1
Merchan
t
Like it on
Offer on
Advertise on
Ad.
Notable sources:
http://gigaom.com/2010/09/29/hey-groupon-its-time-for-a-localsocial-roll-up/

12. Muachung: Backed up by a big media commany: VC CORP

13. Backed up by diadiem.com, and a PR commany in the group

14. Social network marketing

15. With phununet

16. Magento
Main Features:
Checkout
Payment (Bảo Kim, Ngân Lượng)
Customer Account
Order Management
Mobile
Multi Store

20. The Problems with Groupon
● High Commission
● Unstable
● Can not secure customers
● Not really effective PR

21. Related topics
● Traditional Marketing (Newspaper, TV)
● Digital Marketing
● Media Backup
● Social networking (Facebook, Twitter)
● Exponential growth
● Customer Behavior (Buyers')
● As cheap as it can be

22. Xu Hướng Công Nghệ
● Mobile
● Tablet
● Cloud
● Ảo hóa
● iOS/Android
● HTML5

23. Định Hướng Nghề Nghiệp
● Kỹ năng
● Kỹ thuật
● Phi kỹ thuật

24. Lựa Chọn Ngôn Ngữ
● C#
● Java
● PHP
● C++
● Ruby, Python
● Bash?
● COBOL

25. Xu Hướng Mở
● Free and Open Source Software
● Google: FOSS business model
● Xã hội hóa nội dung
● Wikipedia
● OpenStreetmap
● OCR with Captcha-like

26. Cồng Đồng Mã Mở Việt Nam
● Cộng đồng
● Lugs
– Vietlug, HanoiLug, SaigonLug, Ubuntu-VN
● VFOSSA
● Java, Agile, Scrum
● Doanh nghiệp
● Customize, deploy: Netnam
● Integration: iWay
● Development: NukeViet

27. Các Vấn Đề Khác
● SNS
● Digital marketing
● Bảo mật
● Tối ưu hóa
● High Availability

28. Thank you
Q&A
http://slidesha.re/sdKrfJ
Nguyen Vu Hung, HanoiLUG
Email: vuhung16plus@gmail.com
Twitter: @vuhung
Facebook: vuhung16plus@gmail.com

29. References
● http://www.magentovietnam.com/
● http://www.sieumua.com/
● http://www.magentocommerce.com/
● “A study on Groupon.com” on Slideshare.net
● “Groupon business model” on Slideshare.net

30. E-commerce
and
Groupon-like with Magento
Nguyen Vu Hung, HanoiLUG
2011/12/17
PHP Day 2011, Hanoi