In China, Groupon got hammered and local sites bumped up

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When Groupon is experiencing a real hard landing in China, local group buying sites are strengthening their shield to secure their positions in the market.

According to a Global Times article,

“Nuomi.com, one of China’s best-known group buying websites, announced Friday (Feb.18.2011) it will spend 200 million yuan ($30.42 million) on advertising to promote its brand, a move one industry watcher said it had been forced into in order to secure its leading spot in the market.”

“Lashou.com closed a second round of financing worth $50 million from a consortium including Tenaya Venture (formerly Lehman Brothers Venture Partners) two months ago to further secure its leading position in the market.

Meituan.com, another well-known domestic group buying website, which raised $5 million from Sequoia Capital, unveiled in January its 130 million yuan ($19.77 million) advertising bid invitation plan.”

Chen Shousong, an analyst with Analysys International, told the Global Times  that large-scale group buying websites that enjoy huge capital strength will occupy at least 50 percent of the domestic market after a year of intense competition.

(Fun note: Here goes the rumor of how Groupon played dirty little tricks when recruiting in China. One day, the front desk at Manzuo.com’s headquarter, one of China’s leading group buying site, received a call promoting new brand chocolate. It was said in the call that only those who registered with contact information can enjoy free trails. Feeling it’s a good deal, the front desk gave out the contact information of the entire crew of Manzuo.com. When the COO of Manzuo sensed something fishy and called back. It turned that. nothing close to a chocolate company, the call was from Manpower, the recruiting company hired by Groupon.)

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