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Crokodeals: A Moroccan E-Auction Monster Heads to the UAE
A new way of tackling e-commerce and e-auction is coming to the Middle East from the heart of Morocco, through Crokodeals, the first entertainment shopping and auction website in MENA. Originally named Clicoo and launched almost a year ago in April 2011, the website is rebranding and relaunching in the Gulf in May 2012.
Crokodeals started as an e-auction website where users place bids on retail items, but unlike traditional auction sites like eBay, the brand-new inventory is offered only by Crokodeals. The bidding system itself is different as well- users who place the lowest unique bid (meaning no one else bids the same amount) above a certain minimum, win the auction. Therefore bidding becomes less about swooping in at the last minute, and more about the art of guessing an unpopular number.
The revenue stream then comes from a cost-per-bid system not on the actual auctions placed, since the margins. "The main objective is for users to have fun while bidding, an experience they can remember", says Karim Dakki, Managing Director at Crokodeals, who joined the team a year after Clicoo launched and focuses on the site's GCC expansion strate.
The logo of the platform and the overall spirit of the design, featuring a crocodile dressed up in a suit, gives it a bit of a game-like look and feel, which is maybe one of the reasons why the majority of the revenues come from university students. In fact, 5% of Crokodeal subscribers (almost all of which are university students) generate 80% of its revenues. Dakki explains that these subscribers developed bidding skills after getting to know the concept, and are now managing to consistently buy items at 20% of their original value and then resell them afterwards for 80% of their original value, an easy way to make a decent amount of pocket money while in school!
In addition to paying through credit cards, the platform has implemented mobile payment through SMS packages, which was a good solution for their customer based, since not all university students own a credit card, and the MENA region still loves to pay via cash. Bids increased thanks to this service, but since operators take a 50% commission on the SMS revenues, and need up to 3-4 months to wire the money to Crokodeals, the site plans to expand soon to more credit card-friendly markets, like the UAE. "Operators need to implement micro-payment solutions to make it easier for people to buy online," says Dakki.
The Crokodeals team combines experience from both the Moroccan and Emirati e-commerce ecosystems and investing them to set higher the success chances. "Because the online market in the UAE is much more developed, we have been testing the beta version here. That process has taught us many things that we have then applied in the Moroccan market", says Dakki. "The members of our team in Morocco also bring to the table extensive experience in customer service and customer behavior, which applies in this market and throughout the region."
Clicoo was initially launched with the savings of the company founders, and the company broke even one year after its launch, once it reached 22 thousand subscribers. The company itself transitioned as well, becoming the parent company to trademarked brand Crokodeals.
Desipte the unique model, the site is not without competitors- similar platform uniqueauction.ae recently launched in the UAE, and competition is rising in Morocco. In order to differentiate themselves, the Crokodeals team is preparing to go regional, suggesting competition auctions between countries to make it more fun, and looking into funding to launch a broader marketing campaign.
Since the concept of lowest unique auction is relatively new to the region, one main challenge of the team has been educating their customers about exactly how the system works, so that they feel encouraged to come back and bid more (and they've created the below video to reveal the process). Nevertheless, funding and payment gateway solutions are still a challenge that Crokodeals (and many an e-commerce company in the region) is struggling with at the moment.
Maya works as the managing editor at Wamda. She is also founder of Jaridtak.com and a big believer in the power of citizen journalism. She is a multimedia journalist and a digital media trainer and instructor. She holds a masters degree in digital media production from the University of Toulon, France. You can reach her at maya[AT] wamda.com, find her on Twitter @RahalMaya or connect with her on LinkedIn.
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