Daily deal website Groupon is widening its Ecommerce offering with the acquisition of flash-sale site ideeli for $43 million.
Groupon is on a recent acquisition spree and after acquiring Korean ticket purchasing platform Ticket Monster from competitor LivingSocial, have bought fashion flash-sale platform ideeli. ideeli is a flash-sale fashion Ecommerce platform, selling designer brand apparel at steep discounts for short periods of time. ideeli was established in 2006 and was ranked as Inc. magazines fastest growing US company for 2011, after bringing in $77 million in revenue the year prior.
The $43 million purchase is Groupons first major entry into the fashion industry. Groupon will be running ideeli’s business, and plans on using its mobile expertise and market strategy to offer flash sales in other segments.
“We are thrilled to add ideeli and their team to our company. ideeli extends our fashion presence and brings great relationships with many of the top brands in apparel. Our customers have a demonstrated appetite for these offers, and by broadening our reach in this space Groupon is even better positioned as the place you start when you want to do or buy just about anything, anytime, anywhere.” said Groupon CEO Eric Lefkofsky in a statement on the acquisition.
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Groupon along with the acquisition released research showing the off-price fashion market to be worth $40 billion a year.
It will be interesting to see how Groupon will capitalize on ideeli. When first introduced in 2006, ideeli with similar competitors like Gilt Groupe, saw almost immediate success with their idea of flash-sales. Recently it would seem the popularity has died down, with other online fashion outlets like ASOS taking their place, offering relatively low prices without the consumer stress related to flash-sales.
China on the other hand has seen recent success when it comes to flash-sales, with Xiaomi selling over 10,000 smartphones in less than 10 minutes.