Deal-of-the-day websites such as Groupon are tipped as the next big thing in e-commerce.
But an overabundance of so-called group buying sites in the Middle East is threatening to saturate the market.
The region has seen a number of Groupon-style sites launched recently, with homegrown players such as GoNabit and Cobone leading the way.
The sites, which are especially active in the UAE, offer daily discounts with local businesses such as restaurants, spas and shops, with each offer having a minimum quota of people required to make the deal active.
This month, it emerged that Groupon, which recently rejected a US$6 billion (Dh22.03bn) takeover by Google, plans to start offering internet deals in the Emirates next month.
The success of the US site, which is just two years old and already has more than 44 million subscribers, has attracted many others into this market.
GoNabit.com is partly backed by the jobs website Bayt.com, while Cobone.com is backed by the Jabbar Internet Group.
GoNabit struck its first deal on May 26 and says offers such as spa treatments at the Atlantis hotel in Dubai are already attracting orders worth as much as Dh200,000.
Others that have or are about to launch include Madinadeal.com in Amman, Lebanon's Makhsoom.com, and Wanamax.com. Estimates vary as to the total number of group buying sites in the region, although most commentators put the number at more than 10.
"Right now there are 14 sites in the Middle East," says Paul Kenny, the founder and chief executive of Cobone.com. "I see Groupon as a really exciting addition to the market. But we bring our local knowledge."
Commentators and competitors alike, however, say that the market is already becoming saturated.
James Gosling, the business development director at The Entertainer, which produces discount vouchers for more than 4,000 outlets across the GCC, says there has been a rush of group buying websites entering the Middle East market.
"[They are] entering a far smaller market than, say, western Europe and the US," he says. "[The market] is becoming saturated already, nine months since the first site was launched."
According to The Next Web Middle East, a technology blog, there are at least 12 group buying sites active in the region. The site's editor, Ahmad al Shagra, says the UAE group buying arena is already crowded, but he believes there are opportunities elsewhere in the region.
"For the UAE scene things are getting really crowded really fast. But for countries like Saudi and Egypt the field is wide open for someone to capitalise," said Mr al Shagra. "So unless [homegrown sites] figure out how to get everywhere it counts in MENA, and fast, expect to see acquisitions in the near future."
But variations on the Groupon model are also likely to emerge. Wanamax, based in Dubai, plans to launch next month, aiming to bring a "completely different approach" to the field.
Vincent Cottron, the general manager of JCO Group, the parent of the company that operates Wanamax, acknowledges there may be too many sites emerging in Dubai. "The market is good for two, or maybe a maximum of three [group buying sites]," he says.
But Mr Cottron says that while Wanamax operates using the standard group buying model, it will eventually launch a different model, which he says will be announced next year.
"Today it's similar … but what we are building now will have a completely different approach," he says.
Yet while local deal-of-the-day websites may not attract such dizzying takeover approaches as Google's $6bn bid for Groupon, there is success to be had in the market. Established homegrown sites, although still young, stand to make money in the region, says Mr al Shagra.
"There are two types of companies that will aim to benefit from [the Groupon model]: those looking for short-term sales; and those with long-term customer acquisition marketing plans," he says.
"The first will look for the smaller fish in the pond, while the larger, more mature shops will approach the big players like GoNabit and Groupon. The first category … [is] where this model in our region are going to be making the most money."
Mr Kenny says group buying sites can form long-term associations with local businesses. "It's not just a one-off deal, we actively work with businesses to fit in with people's marketing plans," he says.
He highlights a restaurant chain in the Downtown Burj area of Dubai, which he says increased its customer base tenfold after the launch of a discount deal on Cobone.
"We have loads of success stories from businesses that were transformed," Mr Kenny says. "What business wouldn't want 1,000 customers?"
Businesses sold on website deals
On a slow day, a single branch of the Colour Nail Beauty Lounge in Dubai may attract just 10 customers. But the two-salon business got more than 230 customers to sign up in 24 hours when it launched an offer on Cobone.com.
The deal offered a manicure, pedicure and nail colour for Dh59 (US$16.06), less than half the usual cost of Dh130.
Dolly Smayra, the owner, says while she will not necessarily make a profit from the deal, it has helped attract new customers and given her the chance to sell additional products.
"I'm doing [the coupon offer] at cost - I'm not doing it for any profit," she says. "You make money on other things."
About 20 per cent of the takings will go to Cobone, says Ms Smayra. "We've been in business for six years, and have a good base of customers … but why not get new customers?"
On a larger scale, Pizza Express in the Emirates plans to use group buying websites on a monthly basis next year, said Pawan Jain, the company's UAE general manager.
The international restaurant chain has sold three deals on Cobone in recent months, with almost 200 people buying a Dh20 voucher that can be redeemed for Dh50 worth of food. In total, 1,400 vouchers have been sold through the site, Mr Jain says.
"It ensures that you have a footfall into the outlets. Once they come, they come again - and not necessarily through Cobone," Mr Jain says. "I will be doing a deal with Cobone every month - probably more [next year]."
The vouchers offer a 60 per cent discount on food, and Cobone takes 20 per cent of the revenue on that. But group buying sites are still worthwhile, Mr Jain says.
How much Pizza Express profits from attracting hundreds of additional customers partly depends on the staff's ability to sell additional products, Mr Jain says. Also, time limits on the redemption of vouchers mean that about 20 per cent of them are not used, he added.