Comments on: Whither Groupon? http://blogs.reuters.com/felix-salmon/2011/09/01/whither-groupon/ A slice of lime in the soda Sun, 26 Oct 2014 19:05:02 +0000 hourly 1 http://wordpress.org/?v=4.2.5 By: mfw13 http://blogs.reuters.com/felix-salmon/2011/09/01/whither-groupon/comment-page-1/#comment-30434 Fri, 02 Sep 2011 01:04:33 +0000 http://blogs.reuters.com/felix-salmon/?p=9664#comment-30434 Groupon is going to crash and burn because it has neither a sustainable business model nor any real assets. It owns no pyhsical or intellectual property, and it’s business model is easily replicable.

All it “owns” is an idea (i.e. online coupons), and a not particularly revolutionary one at that.

Ten years from now people will be listing Groupon’s decision to turn down Google’s buyout offer as one of the most boneheaded financial decisions ever.

]]>
By: FelixSalmon http://blogs.reuters.com/felix-salmon/2011/09/01/whither-groupon/comment-page-1/#comment-30433 Fri, 02 Sep 2011 01:01:32 +0000 http://blogs.reuters.com/felix-salmon/?p=9664#comment-30433 Thanks for the link! Added

]]>
By: WhartonMBAAlum http://blogs.reuters.com/felix-salmon/2011/09/01/whither-groupon/comment-page-1/#comment-30426 Thu, 01 Sep 2011 23:44:39 +0000 http://blogs.reuters.com/felix-salmon/?p=9664#comment-30426 Can you please link to the full PrivCo analysis on Groupon to put it into context (as you did with BusinessInsider)? Thanks Felix (fyi it’s below too)
http://www.privco.com/press/groupon-runn ing-low-on-cash-and-ipo-likely-to-be-wit hdrawn-nearing-insolvency-august-20-2011

Important to read the full analysis and see how the conclusions are drawn, in my humble opinion.

]]>
By: TFF http://blogs.reuters.com/felix-salmon/2011/09/01/whither-groupon/comment-page-1/#comment-30423 Thu, 01 Sep 2011 22:38:38 +0000 http://blogs.reuters.com/felix-salmon/?p=9664#comment-30423 “The problem it seems, that with time, the offers get progressively dull — near-daily facial, pedicure and massage offers.”

Would these not be the businesses that can AFFORD to sell their services at a 75% discount? For anybody else, it has to be treated (and judged) as a loss-leader.

The BIG QUESTION is whether Groupon does enough to justify the fees they charge. Sure, they splash a deal out there to a million people in a 30-mile radius of your business. But are there not cheaper forms of advertising? Buy the front page of the community newspaper and offer customers 50% off on Saturday. You’ll get traffic out of that, and the ad likely won’t cost you ANOTHER 20% of your day’s sales.

If Groupon wants to charge higher-than-industry fees for ad placement, then they need to justify that with better targeting of those ads. From what I’ve seen, they make no effort to target.

]]>
By: justacouponguy http://blogs.reuters.com/felix-salmon/2011/09/01/whither-groupon/comment-page-1/#comment-30422 Thu, 01 Sep 2011 22:19:25 +0000 http://blogs.reuters.com/felix-salmon/?p=9664#comment-30422 I think we are all missing the BIG QUESTION. Is Groupon good for the businesses?
A hot dog shop that sells $10 worth of product for $5 only to give Groupon $2 of that is not going to see incredible value. For small businesses this is not a sustainable long term model. Customers will buy deals that are clearly “Loss Leaders” if they present a good value. A mobile coupon site like Mobsav is a made to support the business and drive promotions and coupons they build. Give me a free drink with my dog and fries and Ill be back twice a week.

]]>
By: SelenesMom http://blogs.reuters.com/felix-salmon/2011/09/01/whither-groupon/comment-page-1/#comment-30420 Thu, 01 Sep 2011 22:17:12 +0000 http://blogs.reuters.com/felix-salmon/?p=9664#comment-30420 “Maybe your crowd, which is older and skews more artsy, may not be into it, but when it comes to young people Groupon is popular.”

That’s right! Take that, Felix, you geezer. When Felix was first out on his own, he had to use newfangled “ATM machines” to get cash and pay for stuff at the non-big-box stores. You had to fend off dinosaurs with a burning stick to get into these stores. But electricity had already come to the British Isles by then, so at least they had refrigeration.

]]>
By: SelenesMom http://blogs.reuters.com/felix-salmon/2011/09/01/whither-groupon/comment-page-1/#comment-30421 Thu, 01 Sep 2011 22:17:12 +0000 http://blogs.reuters.com/felix-salmon/?p=9664#comment-30421 “Maybe your crowd, which is older and skews more artsy, may not be into it, but when it comes to young people Groupon is popular.”

That’s right! Take that, Felix, you geezer. When Felix was first out on his own, he had to use newfangled “ATM machines” to get cash and pay for stuff at the non-big-box stores. You had to fend off dinosaurs with a burning stick to get into these stores. But electricity had already come to the British Isles by then, so at least they had refrigeration.

]]>
By: PR1 http://blogs.reuters.com/felix-salmon/2011/09/01/whither-groupon/comment-page-1/#comment-30418 Thu, 01 Sep 2011 22:09:57 +0000 http://blogs.reuters.com/felix-salmon/?p=9664#comment-30418 Wither, not whither.

For all its customer acquisition and marketing costs, Groupon doesn’t own its subscribers in any real sense, hence the buzzsaw at the SEC over the phony-baloney profit-before-expenses accounting. They have an email address and no loyalty. Kind of like a john thinking the hooker is really into him (or do I mean the other way around?).

]]>
By: GRRR http://blogs.reuters.com/felix-salmon/2011/09/01/whither-groupon/comment-page-1/#comment-30417 Thu, 01 Sep 2011 21:59:32 +0000 http://blogs.reuters.com/felix-salmon/?p=9664#comment-30417 The food-related Groupons including cafes and bars are very popular…and remember that national Barnes and Noble Groupon, or the Domino’s one?

The problem it seems, that with time, the offers get progressively dull — near-daily facial, pedicure and massage offers.

]]>
By: Auros http://blogs.reuters.com/felix-salmon/2011/09/01/whither-groupon/comment-page-1/#comment-30416 Thu, 01 Sep 2011 21:41:49 +0000 http://blogs.reuters.com/felix-salmon/?p=9664#comment-30416 Uh, in the under-35 San Francisco geek crowd, everybody uses Groupon; I don’t know that it’s seen as “cool”, but it’s certainly not “uncool” like Wal-Mart.

But I think it’s also conventional wisdom at this point that Groupon is going to crash because its business model is not defensible, and that the businesses that are placing coupons are probably mostly losing money and not getting enough return to make up for it.

]]>