Gaopeng, the Groupon-Tencent joint venture in China, was accused of selling counterfeit Tissot watches. Hundred of Chinese customers claimed that the 690 yuan (US$108) Tissot watch they bought from a deal provided by Gaopeng wasn’t genuine. The affected customers plan to team up to seek legal action against the website and its supplier. The official dealer of the Swiss watch brand in China said they have reported the case to the police to safeguard its trademark and intellectual property and is willing to help Gaopeng’s customers with authentication at Tissot’s outlets. The Tissot PRC200 watch, which has provided in the group buying deal, usually goes for around 3,000 yuan (US$472) on the retail market …
Gaopeng released a statement last week, they have been investigating the case since they received the complaints, including the authenticity of the watches and the credentials of their supplier. The group buying company have canceled all the unfulfilled orders and offered full refunds, citing as the reason that the wrapping and guarantees were not original. The person in charge told the press that they got their products through a special channel, the supplier was a subsidiary of another authorized outlet. A sales representative from a Tissot outlet said the guarantee of authenticity for Tissot watches all bear the mark of their distributor and that all watches lacking this are fake. The Tissot watches which sold by Gaopeng, prints on the wrapping was blurred and there was no document stamp from its distributor on the guarantee.
After investigation, Gaopeng released another statement this week. They admitted they had sold counterfeit luxury watches by accident and will compensate its irate buyers. The incident has exposed the failure of their quality control personnel in the examination and vetting of their merchants, Gaopeng will refund the Chinese customers an additional 200 yuan (US$31.50) for the fracas.
Groupon is the world’s largest daily deals site operator and the firm went public last week, valuing the three-year-old business at nearly $20 billion. But the firm has struggled to crack into China market, where local brands dominate. Gaopeng, the joint venture between Groupon and China’s top Internet firm, Tencent, has posted a net loss of US$46.5 million since it was established in May. The company has shut 10 offices in August and laid off hundreds of staff as competition in the group-buying sector heated up. With the purchasing power of Chinese citizens getting stronger (and also not too smart as we say …), lots of international companies have an eye on the lucrative China market. But some of the companies are lack of good quality management and have tried to expand too aggressively. Now Gaopeng will need to pay double marketing efforts to obtain back the trust of Chinese consumers.
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