It's been two years since Groupon, the coupon site that offers daily deals to its subscribes, was founded. Since then a lot of copycats have been trying to imitate this incredible business plan but, they have been unable to obtain the growth that groupon has. One of groupon secrets is to capitalize on promising competitors before the even get the chance to establish themselves; these is a very savvy strategy if you ask me, maybe that is why it turn down Google's offer of $6 billion because it saw the potential growth and power of this company.On the other hand, many retailers are beginning to question previous "sweet deals" with such sites like groupon or living social. The business model for this site is that business make a deal with the coupon site of their choice and offer the customer to pay $10 for $20 worth of in store merchandise for example, then the split the profit in half; but the downside of this arrangement is that the deal site gets the 50% while the business gets the other 50% plus all the expensive marketing expenses. On the other hand, a positive note of this is that for small business this is a smart way to increase the amount of potential customers they can reach, which can never hurt.This comes to the conclusion that retailers are now learning to delegate offers in other to gain a bigger margin of the sales.
Groupon is a great example of a well though and successful business plan. The only problem with being successful is that other people want to copy you idea and bring you down which is what is happening now with this current business. People are getting saturated of so many deals that they are getting in the mail. I believe that they need to start think of other ways that they can reach consumer because it is getting a little old already.
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http://money.cnn.com/2011/03/23/pf/daily_deal_overload/
http://online.wsj.com/article/SB10001424052748704050204576218813288848414.html?mod=dist_smartbrief
Groupon has gained a lot of revenue and business throughout the years since it has been founded. It has a large brand name that small competitors have a hard time keeping up with. The only issue is that they have such a long wait time to update their local retailer in some areas which could affect business for the company and decrease the amount of consumers they could reach in smaller areas.
ReplyDeleteI agree with you Groupon has a great idea. Unfortunately, Groupon is an internet company with an idea not a product. Now there are Groupon copy cats for every region. However, the only “true” competitor, as you mention, its LivingSocial. The only thing with LivingSocial is that Amazon its working with them. With the experience of the Amazon people Groupon could be in trouble. I seriously did not know what Groupon was until last week; I have never seen any commercials on TV or elsewhere. On the other hand, I have seen TV commercials for LivingSocial. The idea of the discounts that these web sites give its really cool, I just don’t think these websites would last long because of the bigger websites with more members that could do the same thing. If Facebook or Twitter starts doing something like that, these websites would be worthless… kind of like MySpace.
ReplyDeleteThat’s the Truth,
Mauricio
Groupon is an innovated idea that has had early success. Will the business model hold up , time will tell.All business is a copycat world. before face book there was myspace and before them friendster. before google there was yahoo before them there was Alta Vista, webcrawler ,aol seacrh and so on. Being the first to come up with a good idea almost guarantees that you will be toppled.
ReplyDeleteI think that Groupon can stay in top of this industry for a long period of time. Moreover, I believe that they will be able to sell many of their stocks and attract several investors. In addition, Groupon needs to make itself more known through advertisement in order to keep the interest of consumers. I believe that they will continue to impress us with cool deals and ideas!
ReplyDeleteMy question for you is with that last sentence, what do you mean getting a little old? In what way are they?
ReplyDeleteKHameed3- In response to your question, what I meant was that people are getting tired of so many notifications that they are getting in their mail's inbox. As a result, this method of reaching the consumer is not being as efficient as it once was.
ReplyDelete