Social Media's Shopping Deals Space Goes Ape With JungleCents
In an already crowded space that includes major players like Groupon, Woot, Gilt Groupe and RetailMeNot, JungleCents enters the field with an inverted affiliate scheme and seed money from billionaire Mark Cuban. Similar to the location-based social network space, unless you become the early-on front-runner like Foursquare, one can find themselves in the rear-view mirror mirror rather quickly. That said, JungleCents' gift card model and weekly deals might make this race for dominance very interesting.
As pledge brothers from the same fraternity, the three founders of Jungle Cents, Sameer Mehta, Haider Mirza, and Nadir Hyder, wanted to discover a way to fuel the growth of online shopping. In 2010, Jungle Cents was formed based on the concept of being social while giving consumers steep discounts at stores they might not have known or shopped at previously.
Differing from Groupon, JungleCents, according to Alexia Tsotsis at TechCrunch, "is a lead generation model similar to how airlines and travel companies such as Orbitz pay affiliate sites like Kayak between $10 to $30 for bringing in new customers." Accepting gift cards in lieu of cash and then running those cards as short-term deals off the JungleCents site is the bait that attracts these new customers.
Sameer Mehta notes the other major distinction with Groupon is the delivery format. Using gift cards instead of coupons, the deals in most instances are national versus local and "offers consumers cash value that can apply to their selections, vs. a discount off a specific item," add Mehta.
Mehta plans on applying their recent funding to hire more people and extend out JungleCents marketing efforts. Having Mark Cuban on board as an investor is less about the money and more about the added value that "Mark’s investor contacts and knowledge" (will provide in taking the company) to the next level,” says Mehta.
The Budget Fashionista is an online shopping review site that has not been so complimentary regarding JungleCents entering the 'Shopping Deals' space. In a post, titled, "Jungle Cents: A Cheap Knock-Off of RetailMeNot," it appears that the critiques about JungleCents have gone so far as to cause the shopping site to levy legal against TBF.
The criticism points to Jungle Cents featuring deals at online stores like eModa.com with gift cards worth $15 that can purchased for $3. She notes that this is a great deal if you actually shopped at eModa.com. While this argument hold some weight, the whole thrust of JungleCents model is to introduce new shopping sites to new customers. If a customer was to dismiss this offer, what is the harm? They simply move on to another offer that is more to their liking.
The other bone of contention that is noted by Kathryn, the site's spokesperson is that JungleCents' "design of their logo is eerily (some might say illegally) similar to that of the popular deal site RetailMeNot.com."
Will leave that intellectual property issue up to our readers and the courts to figure out. In the meantime, with partnership deals already established with big brands like Whole Foods, Beyond the Rack and Amazon, JungleCents is a model that has legs, and one that could cause a major shake-up in the online 'Shopping Deals' space.