Cost of Living Social
Dr Mumbo was of course delighted when Australia’s group buying sites announced a code of conduct.
Apparently group buying platforms can’t mislead punters about how big the discount is:
“GBPs should promote the Offer in clear and easy to read language. GBPs should not engage in false and misleading conduct.
“GBPs should provide Subscribers with accurate information about each Offer provided including:
Exactly. Group buying sites for me started off well – the chance to discover new places to eat, and cheaply – but have rapidly deteriorated. Living Social is one of the worst offenders.
The group buying model could now be summarised as ‘cheap stuff you didn’t want (think eBay rubbish) at a large discount off a ridiculously inflated price’.
Don’t get me started on brands destroying themselves by over-using these sites either…
Too right! These claims of massive discounts are odamaging businesses. Group buying sites regularly advertise 80% of massages at the dodgy little place around the corner for $49. Which would mean the original price was $250….dodgy dodgy maths there! Customers get annoyed when they redeem their services and find that they were not as good a deal as they thought ultimately backfiring on businesses.
The RRP for the Samsung PL120 is $199, take a look at Samsung’s website: http://www.samsung.com/au/cons.....ab=feature. When you add postage and delivery to that, the deal is valued at $215. What we are offering – $125, represents a great deal and we stand by it! We are founding signatories of the Code of Conduct and take this role seriously.
Hey Anu – there is not one retailer anywhere selling that camera for $199. Most are around $120 – $140 so claiming a $199 RRP is just misleading. Also shipping on cameras is on offer all over the place for around $10.
Yes your offer is good value but that’s not the point. You’re claiming a 40% discount and it’s not. I’d pretty sure you’ll find you can’t legally claim the 40% off unless you can prove the product is sold at the full retail price. Even the expensive city camera stores have it at way less that the $199.
I can walk into office works and get it for $148 and it is not discounted:
http://www.officeworks.com.au/...../SAPL120PE
The 40% saving part, to me, is a little misleading. Lets face it though, consumers can research themselves before buying…
Group buying sites can be ok and wont kill all brands.
Generally it comes down to how ethical the salesman is at the group buying business. Guaranteed the sales rep who is in it for the long hall, will sell to the right brands and the ‘shor termers’ will not..
Answer: Group Buying Sites – train your sales reps to be honest(.)
Some buyer education is required here.
RRP is the recommended price only, used by manufacturers to set a perceptual floor under their product’s price and to allow retailers to discount without actually discounting.
In Australia manufacturers are not allowed to set a firm price for their products at retail as this would be anti-competitive… Not that it helped much as Australians still pay some of the highest prices for many products in the world.
Group buying sites should provide a clear indication to their customers that the savings are based on RRP only and may not reflect the savings they actually will get. Anything less is willful misdirection.
Groupon, not Living Social, is being investigated in the UK for “exaggeration of savings claims” amongst other things.
Lucky no one is doing it here.