MobShop ditches consumer biz
Group buying is dying
Californian e-tailer MobShop has ditched its consumer group buying service.
The move is the third major announcement from a "demand aggregation" Web site this month. Rival Mercata.com has said it will cease trading at the end of January, with the loss of more than 110 jobs, while Dutch-registered Letsbuyit.com is in talks with administrators of a debt memorandum to try and find a way to rescue the debt-laden company.
MobShop, whose investors include Netscape co-founder Marc Andreeson, said it was shutting its consumer business because the running costs were too high and consumer set too diverse - it will stick to offering its group buying service to the business sector. The company has been leaning more toward the B2B and government sectors since last year - a move which saw staff cut from 100 to 65 at the San Francisco-based outfit. At the end of 2000 it decided to shut its businesses in Europe.
Its B2b customers include the US General Services Administration, AOL and Citibank.
The likes of MobShop and Mercata worked on the idea of surfers driving down prices through bulk buying - but consumers found they had to wait for products to get the discounts, while big retailers could sometimes offer cheaper prices anyway.
Last week Swiss e-tailer CoShopper said it was in talks to buy Letsbuyit. ®
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