The group buying market has begun to stabilise following two quarters of revenue decline, according to analyst firm Telsyte.

The Telsyte Australian online group buying report shows the group buying industry generated shows the group buying industry generated $117 million in the second quarter of 2012– a 5 per cent decline from the previous quarter, indicating signs the industry is stabilising following two quarters of double digit decline.
During the past 18 months, the industry had rapidly shifted away from local service-based type deals – including food, dining and health deals – to national deals focusing on travel and physical products.
The share of local group buying deals versus national based deals has been declining sharply since 2010. In the fourth quarter of 20120, only 8 per cent of group buying deals were national, but by the first quarter of 2012, national deals made up 51 per cent of the market. Local deals increased from 49 per cent of the market in the first quarter to 55 per cent in the second quarter.
“Group buying sites have seen the success of selling product deals through their sites, but this has come at the cost of losing focus on local deals, the very type of deal that the group buying industry was established on,” Sam Yip, Telsyte senior research manager, says.
“This should stabilise the market and set it up for strong growth coming into the second half of the year with the holiday season.”
Telsyte forecasts the group buying industry to exceed $600 million revenue in 2012 – a 20 per cent increase over 2011, due to an expected strong second half of the year.