Groupon is a derivative of group coupon, an idea initiated in 2008 in Chicago by Andrew Mason. The idea of the business was to deliver day to day discounts on items which had a wide variety of range ranging from newspaper subscriptions to running trainer shoes. The business soon became hit and subsequently was taken out from Chicago and touched Boston and New York enroot to the world market in Europe, Asia and South America (Groupon.com, 2013). The report signifies the importance of a particular location, price or type of product in direct relations to the sales of the discount coupons and the growth of the company in terms of different statistics provided by the company itself over the years it has operated in the open market. The main product Groupon sells is the discount packages it offers at various stores which are dealt separately for the amount of business they bring to such a place. The report will also present its argument based on different statistical data retrieved from various sources which have been sourced by the original company to provide analytical data for the betterment of the company itself.
The reliance of any business on the area it is being done cannot be negated at all. The business is always set up in such an area, or its supply for that matter is tried to be done at the maximum thrust in the locality it is more probable to sell. The same case is with the online selling of Groupon. Although the business is more online that offline, the argument can be made about the reason why geography may be a factor. The selling of discount coupons may not be a factor but the outlets the company provides discounts for, initially were not spread around the world, therefore it is of prime importance to advertise the discounts in the area where the stores are available who offer the redemption of money due to the coupons.
The figure clearly shows the loss of revenue per subscriber as compared between the first quarter on 2010 and the first quarter of 2011. The main reason of this is the shift of priorities from the Boston to other bigger ventures like NY and South America. The drop of revenue in Boston due to lack of publicity is quite visible. This clearly depicts the importance of the area in question for such a company.
Price is the most important factor in any business related to selling of products. The product Groupon sells is the discounted prices of various deals all around the world, like for example night stays at a hotel may be offered at a different price. It is very important to note that the prices should be such that the customer is baited into buying something from Groupon at a discounted price rather than the seller or service provider itself. The price includes the fair share to the company which provides services at a lower cost for the befit of both, themselves and the Groupon Company.
The graph clearly depicts the increase of reviews for a specific range of products increasing their sale and hence the factor of money asked by Groupon (which is definitely lower than the actual price) pays dividend for both the share holders. Groupon benefits by selling more of its product (i.e. the coupons) and the deal bound company gets review which is equivalent to free publicity, nothing more than a company can ask for.
It is very important for the parent company to understand what there trump card is in the market. Hence, the maximum resources and publicity can be directed towards it. This section will try to explain where the gold lies for Groupon.com. According to a report presented by the founding member Andrew Mason the most profitable business is the day to day deals. Hence it can easily be said that daily deals are the bread winners for Groupon.com and al the executives pay special attention to the sales of this said deals. Other highly sought deals fall under the category of goods and travel related products. Buying of concert tickets also brings up a sizeable amount of profit since it is easier to buy tickets of groupon.com especially when it is a high end concert with a lot of demand. Therefore the types of products which are worth watching for the higher hierarchy are marked, wining the argument about the reasons for investment in special types of discount products rather than distributing the investment uniformly.
Hence it may well be concluded with evidence that deals presented by Groupon.com are applied differently in different areas geogriphically, socially and monetary wise. Therefore it can be easily said that yes, the deals groupon presents are better in a particular loclity, type of product and the price it offers in comparison to the actual theme. Such models may not be applied to all products as the company offers a kind of service, rather than the product itself.
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Salmon, F “The Groupon Showdown” Reuters 15-04-13