E-commerce site Taggle.com, run by Bangalore-based Taggle Internet Ventures, has been struggling to survive for some time and it is now officially dead. The company has notified its users that it is shutting shop and has chalked it down to unsustainable price wars.
The story was first reported on Medianama.
Taggle.com was set up as a group buying site, and raised funds from Battery Ventures and Greylock Partners in June 2010. It took a year to start selling online. In fact, Taggle was one of the earliest group buying start-ups in India, founded by John Kuruvilla who was the chief revenue officer of Air Deccan and executive vice-president at Oberoi Hotels.
In mid-2011, Taggle changed its business model from group buying to generic e-commerce and put up a separate page called Taggle Plus that featured various service deals related to spas, restaurants and the like while the main site offered products. On Techcircle.in, we have spelt out the reason behind the shift and the increase in product focus. In August this year, Kuruvilla turned into an advisor and made Rutvik Doshi (earlier the chief product officer) the new CEO.
There is a score of daily deal aggregators in India, led by Snapdeal.com, Mydala.com, Koovs.com and Groupon India (Crazeal.com). Also, Bangalore-based Flightraja Travels Pvt Ltd (Via) has recently launched a deals sub-site called Via Deals More. Rediff offers Deal Ho Jaye while Times Internet (Indiatimes) has set up Timesdeal.com. Then there is Buzzintown.com, Dailydeal.in, Dealivore.com, Khojguru.com, Thekha.com, Scoopstr.com, 24Hoursloot.com, Masthideals.com, Snatchdeals.com, Lootmore.com, 30Sunday.com and Bindasbargain.com, among others.
What Taggle Tells The World
The Taggle site now tells the world at large why it has decided to shut shop:
We have decided to cease our e-commerce operations effective immediately. We will not be taking any more orders from our users.
We started Taggle in June 2010 with US$1M in funding to build a sustainable and profitable business by getting the best service and product deals for our users. We have always believed in providing superior experience and value to our users. When we realized that service deals were not giving the best value to users, we quickly shifted focus to only products. Our users responded very positively to the shift and it reflected in our revenue numbers too, we grew our revenues 10 times within 3 months of the shift.
However, the current market conditions have many e-commerce players selling products at below-cost price to lure users. The only way to sustain the business at this time is to get into a price war and burn a lot of investor money and try to outdo competition in a Last Man Standing game. This practice goes against our philosophy of building a sustainable and profitable company. Hence, we've decided to go back to the drawing board to figure out the best way forward.