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Donnahill's List: Buy With Me

    • Launched 10 months ago, BuyWithMe already sees 110,000 visitors per month (according to Google Ad Planner) which is impressive for a site that’s been around for less than 10 months. Impressive until you find out that 18-month old Groupon receives 5.1 million. How do you grow a website in a market where the leader has an 8-month head start, deep pockets and first mover’s advantage?
    • From what I’ve seen, the quality of their clients is similar to our existing clientele. There’s a lot of crossover, which is a good reflection. We want people who return, not just people looking for discounts,” says Ahn, who was also approached by Groupon but decided to go with BuyWithMe instead.

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    • BuyWithMe makes group buying more personal 
      Do your coupons align your concept with the best friends of your  potential customers? Probably not. But that's what group-buying startup BuyWithMe is aiming to do with its revamped b
    • Do your coupons align your concept with the best friends of your  potential customers? Probably not. But that's what group-buying startup BuyWithMe is aiming to do with its revamped business model.

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    • The average deal price on BuyWithMe is around $30 to 35, which is up from the mid-$20 range just a couple months ago. Even after the discount, which is typically 50 to 70 percent off, the local merchant splits the 35 to 50 percent of the remaining revenue with BuyWithMe. While that doesn’t sound like a great deal for the merchants, most of these deals are for excess, unsold, perishable inventory such as classes, restaurant reservations, or other services. It is really more of a marketing opportunity for local businesses to get exposed to new customers and get people to come into their shops who otherwise wouldn’t think of it.
    • “It is an extremely profitable business model,” notes Rosner. She is plowing all her cash back into the business right now, however. BuyWithMe was founded only a year ago in May, 2009, and already employs 52 people. A BuyWithMe sales rep personally visits each merchant that runs a deal (building a local marketing business, even one online, requires a lot of legwork).

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    • “We are thrilled to be able to accelerate our growth strategy with the   Bain Capital Ventures investment,” said Cheryl Rosner, CEO, BuyWithMe.   “Community buying is a significant trend that is transforming online   purchasing. Our business model has already proven itself to be extremely   successful in harnessing the power of local communities. We believe that   Bain Capital Ventures is the right partner to support the next phase our   growth strategy.”
    • “BuyWithMe,   with its visionary management team and superior product offering, is   pioneering social commerce and redefining the space. We look forward to   being long-term partners with a company that has massive growth   opportunities ahead.”

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    • Buywithme, like rival Groupon, combines the power of online shopping with social media.
    • Buywithme differs from Groupon in that its deals are available for a week rather than 24 hours like at Groupon. Since a new deal is introduced each day, that means multiple deals are run simultaneously at Buywithme. The intention is to prevent any buyer's remorse stemming from impulse purchases, that might then turn people away from the site.

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    • BuyWithMe is a group buying website allowing consumers to leverage group buying power to get large discounts with local merchants. The company is headquartered in New York City. Funding was obtained via a group of angel investors. BuyWithMe's first market was Boston, where restaurants including UFood Grill, Sel de La Terre and Stone Hearth Pizza were initial customers. San Diego and Washington DC[1] followed. As of October 2009, BuyWithMe serves 9 markets and has currently ~150k unique visitors per month according to compete.com. BuyWithMe's major competitor is Groupon.[2]
    • BuyWithMe introduces one new deal every day in each of the local markets it serves. The deal is mailed to all local BuyWithMe customers, made available on the company's website and distributed through a network of group buying media partnerships. The deal only completes if a minimum number of consumers sign up, therefore assuring the merchant a minimum return.[4] The value proposition for a merchant is the ability to attract new customers with a one time offer that has minimal impact on its brand equity.
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