Group buying platforms aren’t hard to find on the Web, but there’s been a growing backlash against the daily deal model, with some consumers and merchants finding the process to be more akin to highway robbery than good business. From high commissions fees and little control of deal details and analytics to low margins and branding concerns, some online retailers and national brands are shying away from group buying platforms.
Launching today at the Daily Deal Summit West is a platform called Rally Commerce that hopes to address these concerns as well as a market segment that is somewhat ignored by Groupon and its claque of clones: eRetail. Online retailers represent a $200 billion market — a big business, to say the least — so Rally Commerce is looking to become a “do it yourself Groupon” for eRetailers to better create, control, and profit from their own group deals and flash campaigns.
Daily deals today are still more focused on local deals and driving traffic to brick and mortar stores, while online merchants have tended to use daily deals more infrequently as part of their marketing strategies. “Over the past few months, we’ve heard top online retailers express frustration with current group deal technologies, particularly when it comes to having control and ownership of their own promotions”, said Rally Commerce CEO Henry Wong. “Rally was conceived to specifically solve these issues and is designed from the ground up to empower merchants, instead of dictating to them”.
Thus, Rally is offering a secure SaaS commerce platform that offers eBusinesses the ability to easily create deals, take advantage of word-of-mouth social distribution, and showcase those deals on Facebook, mobile, or their own standalone site. Obviously, web merchants want to be able to track conversion rates and measure the success of their deals, so Rally enables customers to take advantage of comprehensive analytics on demographic, performance, and conversions — as well as track word-of-mouth promotions on Facebook.
The fact that Rally is a SaaS platform takes a bit of the weight off launching a deal mechanism for online retailers, as the startup hosts the platform so that all eBusinesses need to do is set up their store. That means that there’s no IT integration required. Just a few hours after signing up, online merchants can begin launching deals, after which they control everything and don’t have to worry about space or any of the nuts and bolts of deal creation or publishing.
Another cool facet of Rally is its white label functionality: The startup’s API enables businesses to create customized deal stores on their site or tie them directly into the platform so that they can offer their own solution to merchants. Existing white label deal platforms are solutions for publishers, not for online retailers and merchants, so Wong said that he thinks Rally will be well-positioned here in terms of offering a unique value proposition.
Rally was co-founded by Henry Wong and Lou Kerner, and brings a veteran ad and sales team to the space. The truth is that the daily deal and group buying space is still early in its evolution; there’s a lot of room for innovation and maneuvering. With Rally offering a white label solution, social graph integration, self-service deals, analytics — all from the cloud — the value proposition here seems high. Ah, but how much will it cost? Wong said that merchants will be paying 10 percent commission fees on average.
Check out Rally Commerce at home here, and let us know what you think.
