Bad times for deal site Groupon don’t seem to end afterall. It has exited another market and this time it has sold its Malaysia business to KFit Group. KFit, in which Groupon is an investor, had already acquired the Groupon Indonesia business.
Joel Neoh, Founder, KFit Group announced, “With our Indonesian business achieving nearly double growth since our acquisition, we are confident that the same growth principles will bring an exciting new local commerce offering to Malaysia”.
As reported in September last year, the business closed its doors in Thailand, the Philippines and Taiwan. Outside Asia it had already exited Greece, Turkey, Panama, Morocco, Puerto Rico and Uruguay. Indonesia followed. Last year, Groupon lost US$27.6 million on revenues which continued to fall.
In Indonesia, KFit retained the Groupon branding, but in Malaysia, it will be rolled into its similar local concept early next year, expanding that service into new categories such as restaurants, beauty, wellness, gyms, studios, hotels, holidays, leisure, entertainment and professional services.
One of the fundamental failures of the Groupon model is to convert consumers buying deals into long-term loyal customers for the retailers which use the platform. According to Ellia Pikri, Fave learnt from Groupon’s failure.
He further added, “Coded into Fave’s system are loyalty solutions and flexible offer structures utilising the tried-and-true model of offering deals to loyal customers that Groupon seemingly lacked before. Fave is also a mobile-first platform. It aims to provide a seamless experience for customers to find, share and enjoy a wide variety of special offers from local businesses, all while customers are able to easily experience what the app has to offer straight from their handheld devices.”
Pikri argues the mobile-first approach helps offer a clean and streamlined layout for users to browse on their handhelds. “Plus, reservations are made directly on the app, which cuts out the additional step of having to call a vendor (like via Groupon).”
Fave has more than 3200 businesses on its customer database across three countries.
Pikri said, “While they do have some stiff competition, the combined expertise of Joel’s experience and Malaysia’s growth of online purchasing might just be the push Fave needs to see success where Groupon didn’t”.