The companies of the new partners come from very different directions.
(Photo: Global Savings Group)
Dusseldorf Gerhard Trautmann reports that he even has to explain to his father from time to time how his Global Savings Group actually earns its money. His company now makes sales of more than 150 million euros with vouchers in e-commerce – and has been operationally profitable for years.
If manufacturers want to lure new customers with discount coupons, in many cases the Global Savings Group (GSG) is behind it, which has developed this business into one of the most important marketing tools in online retail. With multi-million takeovers of its competitors Pouch in Great Britain, iGraal in France, Shoop in Germany and Coupons.com in the USA, Trautmann has expanded the Munich-based company into an international provider that is active in 20 markets.
Now, with another deal, he is forging a technology company that brands and retailers in e-commerce will soon find hard to ignore. GSG takes over the shopping community Pepper.com and integrates it into the company, as announced on Wednesday. Pepper is an expert in social commerce and operates platforms like Mydealz that inform customers about special offers on the Internet.
Every second customer looks for voucher codes and price comparisons
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Polls show: Before making a purchase online, every second customer goes to websites that use voucher codes, discount offers, price comparisons and cash-back promises to direct consumers to very specific providers. And intermediaries like Pepper.com and GSG make good money on the commissions they get for doing so. Up to 15 percent of the net purchase value is customary in the industry for the placement of customers.
The new partners come from very different directions. Pepper was founded in 2014 by Fabian Spielberger and Paul Nikkel and competes in Germany with portals such as Idealo or billiger.de. The company is used by 25 million consumers every month and now has locations in Guadalajara, London, Lyon and Winnipeg.
Co-founder Spielberger once described his business model as “Facebook for shopping”. Because not only deals are placed on its platforms, consumers also exchange information in communities. In addition to Mydealz, these are, for example, Hotukdeals in Great Britain, Dealabs in France and Preisjäger in Austria.
25
millions
Consumers worldwide take advantage of Pepper.com’s offerings on a monthly basis.
The Munich-based company GSG, on the other hand, has specialized in vouchers since it was founded in 2012. In addition, it works very closely with the Burda platform “Focus”, among other things, and develops content there that is intended to help customers find and evaluate products – and serves as the basis for linking to offers that again bring in commissions.
Attracting customers with savings opportunities has become one of the central marketing tools on the Internet – especially among price-sensitive German consumers. And in times of inflation and rising costs, the search for savings is likely to increase. According to a survey by GfK, a third of Germans plan to spend less on Christmas presents this year. 74 percent of those surveyed want to pay more attention to offers.
Investors put 75 million euros in Global Savings Group
GSG is poised for further expansion in this environment. While Pepper has so far grown without external investors, GSG has a group of strong investors behind it, including Rocket Internet, HV Capital, Deutsche Telecom Capital Partners and Group M6, who have invested EUR 75.7 million in the company over the past few years. As a result, the company has been able to double its sales in each of the past two years, both through organic growth and through acquisitions.
The acquisition of Shoop alone cost GSG more than 30 million euros last year. The company did not name a purchase price for Pepper. The latest deal expands GSG’s workforce from 700 to over 900.
“For me, GSG is one of the most impressive companies in Europe,” says David Kuczek, General Partner of HV Capital. In recent years, the team has managed to establish market leadership in the coupon and cash-back market segments in many countries around the world. “Even in a highly competitive market like the USA, GSG was able to expand its position with the acquisition of Coupons.com,” he says.
GSG can now also integrate Pepper’s price comparison sites into its network. “We are very pleased about this groundbreaking deal, which strengthens our leading position in Europe,” explains Trautmann. Together they wanted to create an even more comprehensive portfolio of purchasing solutions with an enormous reach. The merger will further advance GSG’s growth, according to Trautmann.
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