As the region witnesses the departure of LivingSocial and rumors that Jabbar is looking to sell Cobone, one startup in Egypt is pushing forward with a new angle on daily deals, taking daily deals mobile.
Dealazion, a new startup from the AlZwad group, is, in a word, an aggregator. It's not a particularly innovative product. In fact, it's one that daily deals sites usually hate- the sites that list all of their deals in one place divert traffic and loyalty away from their own sites (if customer loyalty exists in the daily deals space).
But this Cairo-based startup is not a website; in fact, it's just a mobile app that aggregates deals from major Egyptian daily deal sites- HalaDeals, Offerna and AgmadDeal, as well as e-commerce site Nefsak.
Why is this aggregator remotely interesting?
It may make daily deals smarter.
Rather than buy and download deals ahead of time and then wait to use them (and potentially never get around to it), Dealazion, whose name combines "deal" with "zion," as in "occasion" or "sale" in French, reveals the deals' location. Shoppers can check deals in the vicinity as they browse or receive push notifications about specific categories of deals.
If there's one major criticism of the daily deals model, it's that sites scrounge for deals and end up spraying the market with offers that aren't targeted enough.
Dealazion's goal is to simply make it easier for the customer to find what they want, offering four categories: lowest price deals, most popular deals of the day, the most discounted deals, and nearest deals based on location. It also works to learn user habits and get smarter at its suggestions.
"Most of the investment we've put into Dealazion is in the technology," says president Ramzi Alharayeri. "We've put extensive R&D into building our iOS, Android, and Blackberry apps and working on their algorithms. The goal is to build loyalty with our customers; by selecting the cream of the crop from a given set of deals, the app adds value over going to the daily deal site alone."
Critically, making smarter suggestions benefits the daily deals sites as well.
Dealazion isn't just promising the sites more traffic from mobile; that's a sales pitch that could be quickly made obsolete with a good in-house mobile developer. No- the company is also selling its algorithm's ability to track customer behavior.
"E-commerce sites struggle to identify who's visiting their site," says Alharayeri. "Customers don't have much information in their profile; they come online, buy things, and disappear. Unless someone comes directly to the website, there's no business for these companies. But we can see your finger moving on the screen."
What Alharayeri describes is hardly a universal case- Amazon, for one, has worked to build a leading recommendations engine based on purchases. So the issues isn’t necessary that daily deals sites can't improve their analytics; but that their ability to do so depends upon their bandwidth and known how, and Dealazion is offering an out-of-the-box deal.
Can it Save Daily Deals?
Right now, the Dealazion app, which launched in beta in mid-July, has around 300 users currently testing it. On the Dealazion site, it's only available after scanning a QR code, a minor barrier to use that I bet will come down after it exits beta. You can also simply search for it in the iPhone, Android, and Blackberry stores.
In the future, Alharayeri plans to build APIs for e-commerce sites so that customers can directly order online through the app. He also plans to boost the apps' recommendation and search ability- a wise move to prevent it from being merely another daily deals aggregator in its final form.
In the current climate, Dealazion may be able to save daily deals by giving customers a new way of accessing offers, but should customers ever tire of group coupons, it may be able to pivot towards a standalone product that simply provides great regional product comparison with geolocation, while providing in-region payment gateways.
They’re not daunted by LivingSocial’s exit. While the platform was "never that big" in Egypt, Alharayeri doesn't understand why they went under.
“All successful technology companies suffered losses in their first few years. I mean all. Technologists must have the stomach, the determination and the flexibility to pivot when needed. I find it very hard to believe that smart people like LivingSocial don't have this in their DNA."