DEALBREAKER? Tough times ahead for Middle East’s daily-deal websites
As rumors of LivingSocial’s potential Middle East pull-out surface, Kipp wonders whether the time has come for daily deal websites alike in the region.
August 13, 2012 4:01 by Eva Fernandes
Over saturated and claustrophobically cluttered, Kipp has been predicting the death of the daily deal website in the UAE for some time now. And when we heard whispers of the potential Middle East pull-out from major US daily deal site LivingSocial, we couldn’t contain our fondness for doomsday prophesies without predicting the end is indeed near…well it is at least for one daily deal website in the Middle East.
It hasn’t even been that long for dear old Living Social. After all, the company bought local startup homegrown Gonabit just one year ago. At the time, LivingSocial was on something of an acquisition spree, it had most recently acquired a deal website called Ensogo from Thailand and the Philippines, DealKeren in Indonesia and it had also recently launched operations in the Netherlands.
Even though it acquired GoNabit at a time when there were over 20 group buying already competing for business, LivingSocial initially was doing pretty good. In fact, not ten days after LivingSocial acquired GoNabit did we hear rumors that the company was in talks with Barclays, JPMorgan Chase and Allen & Co to raise about $1 billion in an initial public offering. Nothing much came of the IPO and now one year later, The National reports the company is looking to sell its subscriber base in the UAE, Egypt and Lebanon,
Now with more than 20 group-buying websites around from Cobone, Moosavings, YallaBanana and BBM Baby, Nailthedeal, Cobonza, Cobonatti, Mox Deals and Makhsoom—Kipp isn’t too surprised with LivingSocial’s supposed plans. After all the daily deal market has long since been saturated in this part of the world. And though we have been predicting the overall crash and burn of the entire sector for some time now, we think if done well the daily deal website may still have a good few years in them.
What will be interesting to watch is how these sites reinvent themselves as they attempt to stay fresh and relevant. We have seen a genuine shift in the type of deals one of the leading daily deal websites in the UAE, Cobone.com, has offered. With a recently revamped website now online, Cobone has extended its variety of special deals to include, a special section for mothers, electronics, fashion and even a section for premium goods. But will this be enough? When a major player with an international presence like LivingSocial contemplates pulling out, you can’t help but worry for the health of the others…