Group-Buying Companies Find Trust is Not for Sale

Groupon’s move into China was recently used as a “How Not To” guide at a Global Mobile Internet Conference session. People’s Daily Online reports on the latest lesson from Groupon’s Chinese offshoot, Gaopeng, and the crowded group-buying market’s broader trust problem.

Gaopeng organized an online “lucky draw” on May 4, with two popular iPhone 4s to be given as prizes on May 10. Word of the promotion flashed online and more than 110,000 netizens forwarded the news via micro blogs.

The winners were to be selected at random. However, when their names were announced on Tuesday, sharp-eyed netizens recognized that the winners were Gaopeng employees (their e-mail addresses gave them away) ….

… Gaopeng is not the only company to stumble, said Zhou Qingshan, deputy director of the information management department at Peking University. “Without exception, all the group-buying websites boast about honesty and integrity, but there is often conflict in their actual operations.”

Wang Peng, who works for a real estate company in Northeast China’s Jilin province, had a common complaint. “I paid 88 yuan for a sausage group-purchase on 58.com, and after 10 days I got a call from a man who said he couldn’t deliver the goods. I asked for the reason and the man hung up the phone and powered off. I called customer service and they said the seller would contact me next Monday, but no one called me about the sausage the whole following week.”

“I joined group buying and bought a pair of shoes last month,” said Zheng Lili, who often shops online. “The seller claimed that the shoes were made of genuine cow leather, but the pair I got was poor quality and was not cow leather at all.”

See also: CDT coverage of Groupon’s controversial Superbowl ad.

May 16, 2011 12:02 PM
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