MIH kills group-buying site Dealify

Another day, and another Groupon clone bites the dust. After a whirlwind gold-rush to emulate the incredible success of Groupon, there has been nothing but bad news in a recession-hit economy for the hundreds of thousands of group-buying clones out there. (Yes, we know there are exceptions).

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Emerging markets media and internet giant, Naspers is going to shut down Dealify, its late entry into the group-buying space, after just a few months in existence.

“MIH has decided shut down Dealify, that I can confirm,” MIH CEO of Platforms Stephen Newton told Memeburn.

MIH is the media giant’s investment arm, with reach in a diverse number of markets including China, Poland and Brazil.

While Newton, a former Google South Africa Country Manager, was able to confirm the closure, he was unable to disclose exactly how the shutdown would take place.

“We’re still working out the details,” he said, adding that the company would do its best to ensure that it met outstanding obligations to clients and customers.

According to Newton, up to 18 jobs could be affected by the closure.

He added, however, that a scenario involving “retrenchment is always the last possible option”. Those that wished to stay, he said, “will be given opportunities to move into other spaces within the company”.

When asked if the closure of the site was symptomatic of any inherent flaw in the group-buying business model (it’s a business model that’s easy to copy), Newton believed that others could still be successful in the space.

Newton said the model was not a fit for MIH: “I think it didn’t work out for us… It’s not in our long-term interest”.

Dealify is the second South African deals site to be shut down in recent weeks.

Zappon, owned by rival media group Avusa, recently got the chop following its unsuccessful attempt at the group-buying game.

Avusa had initially hoped Zappon would be propelled to success on the back of its various print and online media titles.

It seems to be retrenchment and closure season, even for a fast-growing online economy.

Naspers recently shut down the Kenyan and Nigerian branches of its ecommerce business, Kalahari.

News24, the largest online publisher in Naspers’ home base, South Africa, was also hit with retrenchments, reportedly of about 10% of its staff.

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