TimesDeal makes all deals free, woos users

New Delhi: TimesDeal.com, the daily-deals website run by Times Internet, has announced that all deals offered by it are now free. TimesDeal has so far operated with a revenue model similar to that of its competitors, like Snapdeal, which charge an upfront amount while providing a deal. The site has traditionally charged 20-40% of the deal value upfront.      "There are several players in the daily-deals market in India at the moment. But no one is making much money. The margins are paper-thin and the business environment is getting more challenging due to demanding customers and shopkeepers. Everyone has to try out something different," said Satyan Gajwani, CEO of Times Internet. "Free deals are our way of disrupting the market."      In 2010, tens of daily-deals sites were started in India. Only a handful have survived and at the moment there are just six or seven websites that are making serious efforts to stay in business and grow. TimesDeal made the decision after it found that free deals can work wonders for volumes. On Valentine's Day this year, TimesDeal ran a promotion and made all deals free. As a result, there was a tenfold increase in consumption.      "After the Valentine's Day's promotion, we knew we had tapped into some significant, latent demand in the market for free deals. We started working on the free product after that. Last week, a promotional code was accidentally released and it spread on the internet. TimesDeal experienced over 100,000 transactions, a dramatic increase in deal consumption before the code was withdrawn. While we lost revenue from the mistake, it validated our belief in a free deals platform just as we were about to launch it," said Gajwani. He said the company would think about the revenue question after a few months. "At the moment we are focused on making TimesDeal a compelling service. We want more people to use it. Once we have users, we will think about monetization," he said.      Asheesh Raina, a principal research analyst with Gartner who tracks e-commerce in India, said that fundamentally the TimesDeal move was no different from what other websites do. "The charges for daily deals are anyway very low. I feel this move is more of a change in marketing message. But it has the potential to attract more users to the website," he said. Raina also believes the daily-deals sector is set to grow. "As more people get access to the web and adoption of smartphones grows, demand for daily deals will grow. Much of it is likely to come from smaller cities as people in these places do not have much choice in brick-and-mortar shops," he said. TimesDeal said it is overhauling its user interface to focus more intensely on the discovery of deals.      TimesDeal is a business unit of Times Internet, the digital arm of The Times of India Group.