Daily deal sites like have taken root in cities all over Israel, with over 80 currently running deals. Back in January 2011, Groupon bought out Grouper.co.il, Israel’s first to market daily deal site for an estimated $8-15 million US dollars. On August 3rd, 2011, BUY2 bought out competitor Deal Hayom for 2 million shekels ($568,000, 08/06/11, Hebrew article). BUY2 is Israel’s largest daily deal site based on total Facebook friends and average revenue per deal. According to daily deal aggregator site Tavo.co.il, BUY2 has a 17% Israeli coupon market share, and Deal Hayom has 7%.
With double the number of Facebook friends, and probably an even larger e-mail database, BUY2 tripled Groupon’s revenue for the day. I have just checked today’s deal, for August 13, 2011, BUY2 made a revenue of ? 90,000, and Groupon.co.il made a palsy ? 2350 . Groupon is a consistent slacker in the market. It seems like their Facebook friend list is mainly due to their brand name recognition and not the quality of deals they are running. 100,000 Facebook friends in Israel is equivalent to over 5,000,000 Facebook friends in America. A major aspect of the Israeli daily deal space are the daily deal aggregators. These are sites that show you put all the daily deals in one place, and make an affiliate commission for referring customers. Daydeals.co.il, Getitall.co.il, dailyd.co.il, cliqa.co.il, and tavo.co.il are amongst the largest around. Most savvy users have these sites bookmarked and will go directly to the aggregators before viewing individual deal sites.
Finally, I want to make a special mention of Treepodia.com, an Israeli video marketing company that markets to the USA, France, England, Germany and Southeast Asia. They recently signed a deal with Cliqa, one of the Israeli daily deal aggregators listed above. Cliqa will now be automatically making videos of selected daily deals using Treepodia’s technology. With aggregation business so close to commodization, video clips may be what they need to stand out. “The whole area of daily deals and group buying, which has grown and developed drastically in Israel during the last year, is filled with rivalry between the different competitors in the market. The service offered by Cliqa together with Treepodia of video clips describing daily deals and transforming information to an interactive experience, is a unique service which does not exist in this area in Israel nor in the global market, “ says Cliqa owner Oded Barel.
* Ben Bakhshi is an Israeli citizen born in California. He has a degree in Business Economics from UCSB and serves in the IDF Air Force.
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