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Marketing

Published June 24th 2011

Ocado Strikes Blow To Groupon Rival Crowdity

Group buying website Crowdity has just suffered a huge blow to its already mammoth quest to take on market leader Groupon, at the hands of Waitrose delivery service Ocado.

Crowdity

The whole idea of group buying is based on a simple principle, described by Crowdity’s own CEO : “We bring people together to buy, meaning we can go to businesses and negotiate a large discount that you wouldn’t be able to get alone.”

Sounds great doesn’t it? Well that’s exactly what thousands of new customers thought when they came across Crowdity’s Ocado deal, offering £40 worth of grocery shopping for the price of £20. The offer, to be registered for on 22nd June and redeemed by 30th June, was part of Ocado’s current scheme to try and attract new business (the offer isn’t available to incumbent customers).

Too Successful?

Clearly Crowdity and Ocado weren’t prepared for the response their offer was to receive. Around midday today, Crowdity sent out this apology email on behalf of Ocado:

Ocado Apology

‘Ocado were only able to offer a limited number of these vouchers. Due to the success of the offer and the widespread distribution of the offer on other forums, this number was exceeded on the first day, rather than on 30th June as originally anticipated. As such, no new redemptions of the voucher can be accepted after 23rd June. Other acquisition offers are available and will be available in the future. Sorry for any disappointment this may cause.’

Team Crowdity would also like to echo Ocados appology. We are all deeply upset about the whole situation and can’t explain to you how sorry we are.

Sincere Apologies

The Crowdity team”

Buy together! (But only some of you…)

So, a service that is entirely built around the very concept of consumers being able to obtain large discounts if they share the offer with enough of their peers, has been defeated by its own success.

The lesson? If you are going to take on the biggest social-buying service out there, don’t allow your suppliers to limit the quantity of redemptions and undermine the fundamental principle of your business.

We will of course be using Brandwatch to keep an eye out for any interesting reactions…

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