Group-buying has been a major buzz word of this year. What originated with Groupon, has erupted into thousands of sites trying to emulate the potentially lucrative business model. It’s come to a point, where it’s a little boring now. But occasionally, some entrepreneurs try to innovate on the group-buying idea and make it ‘cool’ again. One such start-up, was Spoqa, a Korean start-up that uses a SOLOMO gamification point system to group-buying.
Now, a new start-up called Plukka.com has come up with an innovative group-buying model and applied it to jewellery manufacturing and online sales. The core concept and motto behind the company is, “What we make is what you want.” Meaning, production doesn’t start until a threshold of orders is made. Thanks to economies of scale, the more pieces that are made, the cheaper it gets for Plukka to make them. These cost savings are translated into price savings for the end consumer. Smart!
The really cool part about the saving mechanism is that you can visualize it on the site in real time. A patent-pending sliding scale calculator shows the range from zero purchased to ‘X’ units purchased and the corresponding prices. The more purchased (past the threshold), the cheaper it gets. Numbers are updated in real time and everyone gets the lowest price, when the sale ends. So no matter if you decided to buy at the starting price, you will still get the same ending price as the last buyer.
Plukka specializes mainly in gold, diamond and gemstone rings, necklaces and earrings. The advantage of using this system is that, unlike traditional group-buying that tries to get rid of last season’s stock for cheap, Plukka is able to offer new and customized jewellery for cheap. Moreover, rather than create new designs that may or may not sell well, Plukka is able to make new designs, put them up for sale and test if people will buy them before they even start producing them. This helps Plukka take more daring risks in design plus also saves them months of work and expenses. A model that reflects the lean start-up methodology of proving people will buy, with as little time, energy and cost possible.
Plukka also has a special rewards program that encourages people to spread the word. According to the website “By referring five or more friends to the same item you have committed to purchase BEFORE THE EVENT DEADLINE, you will immediately receive a 10% discount on the price of the item. For each referred friend who buys the same item, you receive an additional discount of 10% off the same item, with a maximum limit of 40%. Let’s say you refer 7 friends and 2 of them actually buy the same item. The total referral discount received will be 30% off YOUR price, i.e., 10% for referring 7 friends, 10% for Friend #1’s purchase plus 10% for Friend #2’s purchase. If you refer less than 5 friends, you will receive a discount of 2% per friend.”
The start-up was co-founded by Jai Waney and Joanne Ooi and came up with the brilliant concept in April 2011.