Group buying involves offering products and services at significantly reduced prices on the condition that a minimum number of buyers purchase them. Each day, a deal is featured on social media and email newsletters. Customers pre-purchase coupons and share the deals to help meet the minimum threshold. They then redeem the coupons at the merchant to receive the discounted items. Daily deal sites have changed online commerce and given businesses a new marketing channel, with some sites selling for millions despite only operating for a short time. However, group buying is still in its early stages in Wollongong.

1. Group BuyingHow and Why it works Alex Whiteside Final Year StudentBachelor of Internet Science and Technology (Internet Commerce)University of Wollongong

2. What is Group Buying? Group buying, also known as collective buying, offers products and services at significantly reduced prices on the condition that a minimum number of buyers would make the purchase.

3. How it works? Each day an item is featured and communicated through social media and email newsletters. High priced items, sold at a discount Business owner sets the minimum/maximum number of coupons As a business can be guaranteed a minimum amount of customers they can set really low prices Customer pays upfront so they are locked into the deal Customers share deal around social media to ensure the deal reaches the minimum number Customer visits the merchant with pre-purchased coupon

4. Advantages over other Media Reach a large market with no upfront costs Can be targeted to a known demographic through social media The deal can go viral increasing brand awareness Customers may invite their friends (who may not have coupons) to come along while they redeem their coupon Easy to limit discounted sales, if necessary, not very easy with printed coupons Have a creative written up on your business at no cost Increase SEO (Search Engine Optimisation) for your website.

5. Would you turn down a $6 billion offer from Google?

6. Groupon did

7. Google’s $6B offer to Groupon Just before Christmas 2010, US Group buying leader groupon.com rejected a US 6 billion dollar offer from Google. Groupon has also entered AU market and has been forced to operate under different brand StarDeals.com.au due to trademark issues.

8. More then 11,000 sales in 1 day

9. So, Google did it themselves Google have realised the future of online commerce. Google now dominate their paid advertising, and “Place” pages with local deals. Best of all, it’s free.

10. Spreets, a $40M Offer! Recently, in February 2010, Australian based group buying website Spreets.com.au sold to Yahoo7 for $40M – when only 10 months old.

11. The future of e-Commerce? Businesses now have a new medium to market and sell their products and services. Daily deal sites have changed the way we shop. Social media will have a big influence on the future of this industry.

12. Group Buying in Wollongong As of yet there have been no daily deals in Wollongong. Although, a website I run, SealTheDeal.com.au is focused towards operating daily deals in the local area.

13. Questions?