Online Group Buying-What Is There for Customer

Topics: Discount rate, Group purchasing organization, Respondent Pages: 13 (5069 words) Published: November 17, 2012
Available online at

Procedia Social and Behavioral Sciences 24 (2011) 308–316

7th International Strategic Management Conference

Online Group Buying: What Is There For The Consumers?
rem Eren Erdo mu


, Mesut Çiçekb a∗

Marmara University, Anadolu Hisarı Campus, Istanbul 34810, Turkey b Yalova University, Safran Campus, Yalova 77100, Turkey

Abstract Online group buying, which is a system that provides daily discounts for various services and products, is a new form of marketing at the junction of promotion and pricing that had attracted the attention of both practitioners and academia. Getting started initially from the USA context in 2008, the system proved successful; and just in a short time, lots of clone group buying web sites has sprung and spread throughout the world. The main reason for that boom is that the method provides a win-win situation to the shareholders of the systems, the firms and the customers. The purpose of this paper is to analyze the online group buying system in Turkey, where the practice is quite new and needs a thorough understanding for future strategy building. The customers were considered as the population of the sample and in depth interview method was used to shed a light on their motivations, behavior, and perception of the online buying system. The results indicated that customers mostly based their decisions on price advantage and discount amount. However, novelty and extraordinary nature of the offer also counted. The customers, on the other hand, complained about the discriminatory and dishonest behaviour of the service providers. Implications for the campaign holder firms, the intermediaries, and for future research were drafted.

© 2011 Published by Elsevier Ltd. Selection and/or peer-review under responsibility of 7th7th International © 2011 Published by Elsevier Ltd. Selection and/or peer-review under responsibility International Strategic Management Conference Strategic Management Conference Keywords: online group buying; group purchasing; collective buying

1. Introduction Marketing is a dual value creation process, whereby the firms create value for the consumers and the consumers in return create value for the firm [1]. In other words, the realization of profits and growth for the firm is achieved through creating customer value, satisfaction, and loyalty. However, in today’s competitive market place, different approaches to common methods of marketing and customer satisfaction are needed and possible with the latest developments in institutional structures of the marketplace such as the Internet. The Internet has affected the ways of doing business and earning profits.

∗ rem Eren Erdo mu . Tel: + 90 216 336 52 73 Fax: + 90 216 345 86 29 . E-mail Address: .

1877–0428 © 2011 Published by Elsevier Ltd. Selection and/or peer-review under responsibility of 7th International Strategic Management Conference doi:10.1016/j.sbspro.2011.09.138

˙ I rem Eren Erdog , and Mesut Çiçek / Procedia Social and Behavioral Sciences 24 (2011) 308–316 ˘mus


Therefore, in recent years, many entrepreneurs have tried to launch new and creative online businesses. One such is online group buying system, described as one the most successful and profitable online business since 2008. It has attracted the attention of both practitioners and also the academia because of the direct network effect it provides to the marketing practice especially to the pricing and promotion junction [2], [3], [4], [5], [6]. Online group buying is part of an innovative wave of online market-based mechanisms along with auctions, reverse auctions, and “name your own price” schemes [7]. Online group buying had been facilitated by the Internet and the easy, fast group coalition process brought by social networks [2]. There are mainly two different types of online group buying systems. First type of group buying is structured based on a dynamic...
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