Group buying site Spinzo staffs up for Toronto launch

By Edward Keenan – YongeStreetMedia.ca | link to original article

Saint John, New Brunswick-based group buying website Spinzo is preparing to launch in Toronto. The company is staffing up—hiring sales and marketing staff—in anticipation of bringing its “progressive savings” model to the GTA.

The variation on popular group discount sites adds a “more people equals a better deal” innovation. That means the price of an item falls when more people sign up to buy it. The platform also allows purchasers to bid a price they are willing to pay, committing to buy it only if the price reaches a certain level.

CEO Emmanuel Elmajian says this model attracts a better caliber of business to offer deals.

“If you look at many of the [traditional group buying sites], you see they tend to attract lower-end merchants,” says Elmajian. That's because such sites use deep discounts as the main selling point. “A lot of businesses, restaurants in particular, don't want to do that.” He says they might offer a 20 per cent discount as a base, and then up it to 30 per cent or more if a certain number of people bid. “Then maybe they want to cap the discount at 40 per cent. That's perfectly fine.”

The more-people-equals-lower-prices approach, he says, also “brings viral back into the equation.” Buyers have a strong incentive to publicize the deal.

The company launched in testing phase earlier this year, with more than $500,000 in investment from private and public partners led by Growthworks. Elmajian says the company has a sales person working in Toronto now, and is looking to add another one or two, in addition to hiring a marketing coordinator. Spinzo should be live, offering deals to the general public sometime in the next month and a half.