TimesDeal.com, the daily deals site of Times Internet Ltd, has changed its business model wherein it has done away with asking consumers to pay a token amount for availing the deal upfront, which is cusomary in peer group. Earlier, TimesDeal charged users for 20-40 per cent of the deal value upfront, which it will no longer collect.
Speaking to Techcircle.in, Satyan Gajwani, CEO of Times Internet said, “We are throwing away our business model and not charging any fee either from the vendors or consumers. Right now, we are focused on creating a strong platform and grow our consumer base by three or four times in the coming months. ”
He also added, “As a consumer, I will be unhappy paying an upfront fee. Hence, we will continue to operate for the coming six months like this, then we will think about other revenue model probably, sticking to this business model.”
Others in the business such as SnapDeal, Crazeal (operated by GroupOn) and Mydala charge an upfront amount to purchase a deal.
In a statement, Gajwani said, “In February, TimesDeal ran a Valentine’s Day promotion where all deals were free, and saw a 10x increase in consumption. This drove the internal conviction for a free product. After the Valentine’s Day’s free promotion, we knew we tapped some significant, latent demand in the market for free deals, and so we started working on the free product. ”
He added, “Last week, a promotional code was accidentally released and spread around the Internet. Before the code was cancelled, TimesDeal also saw a dramatic consumption increase here as well, with over 100,000 transactions before it was closed. While TimesDeal lost meaningful revenues from the mistake, it further validated our belief in a free deals platform just as we were about to launch the new service.”
But will your vendors be happy with this model? Gajwani said, “Why not, they are not paying any extra money and in return they are getting more consumers. We are live with the new model for less than six hours, and we have already seen five times rise in traffic.”
TimesDeal is also examining its user interface so that it can focus more on the discovery of deals, making the process of consuming a deal faster and simpler and to allow users to see more options that are targeted and personalised to their interests. It claims to have a strong base of 10,000 participating merchants from nine cities and from various industries such as food and beverages, beauty services, entertainment, health and fitness and travel. The company also intends to add 5000 more vendors by end of this year.
(Edited by Prem Udayabhanu)