BenefitsPLUS has announced that it will invest in Koovs.com, which is a B2C daily deal group buying websites claiming to have about 400,000 registered users. Very recently on 31st May 2011, benefitsPLUS had announced its acquisition of Snowball eRetail Services, which is also an online retail website offering products and services at a discounted price for the corporates only.

By announcing its investment in Koovs, benefutsPLUS is aggressively increasing its foothold in all possible segments of the growing deal-discount industry in India – 2 investments in 2 weeks! “After establishing ourselves as an exciting B2E player, venturing into B2C was a natural and obvious extension, giving us automatic leverage. We want to take the online shopping experience to the next level and will invest $3 million on marketing, technology scaling and on new hires to strengthen our value proposition for consumers. We will continue to grow and take a large bite of the ecommerce economy to become a significant player in the daily deals space too”, says founder & CEO, Paul Shoker, as reported in Business Standard.

True that the deal-discounting industry is now set for consolidation and it makes a good business sense to take away large pie from India’s growing e-commerce industry as such. But does it also call for throwing caution to the wind when investing in this industry especially after Groupon faced a bash-down by the investor community when it filed for an IPO? One of the biggest questions raised was why are people buying lesser ‘groupons’. Is it too short a duration in the life cycle of group-buying deal-discount industry so as to understand whether there is a long term value in these models or is it just a short-term fad?

This is one of the important angles to be considered by investors and other entrepreneurs who may be contemplating into launching an e-commerce website in the deal-discount space.