I understand about group notifications being annoying, but these groups seem very popular for food & clothes. I am not sure what the success rate is for these businesses, though WhatsApp is trying hard integrating payments via UPI also in India.

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But is it popular for users or for businesses? I think business like them but users hate them.

Possibly... But I don't think it's too bad for users (In India, businesses are anyways not known for customer-friendliness, so I suppose it's within tolerable limits).