Groupon SA closes; Bargain Buys still running strong

NOVEMBER 4, 2016

Groupon has wound down its operations in South Africa and Groupon SA has stopped offering deals in the country.

Groupon recently announced it was exiting numerous countries as part of its strategy to operate in a “streamlined country footprint”.

“The Company has identified its go-forward country footprint to consist of 15 countries, down from 27 in the portfolio as of the second quarter 2016,” said Groupon.

“We are pursuing strategic alternatives and other options to exit the remaining countries, which we expect will continue into 2017.”

South Africa is one of the countries which Groupon is exiting.

Often criticised for being an unsustainable business model and for not offering any barriers to entry to its competitors, many people will argue that Groupons’ closure was a forgone conclusion.

Bargain Buys, who also offer discounted vouchers to consumers, was launched in Port Elizabeth at the same time as Groupon began operations in the USA.

Graeme Lund, the owner of Ricochet Publishing to whom Bargain Buys belongs, says; “Our only commonality with Groupon is that we both offer discounted vouchers to the public.  Our business model is very different to Groupon. 

“We offer our service providers a substantial and effective marketing campaign that includes print, web, email and social media for a limited number of vouchers.  If we do not market the service provider effectively then nobody will buy the Bargain Buys vouchers.  The fact that people buy and redeem Bargain Buy vouchers is proof that our marketing of the service provider was effective.”