Made by - Edita Macikaitė EBMmfs3-01

What Is Groupon?

• Established: 2008;

• Industry: Advertising and marketing;

• Firstly started: Chicago;

• 500 markets in 44 different countries;

• Working principle: Deal of the day.

Groupon On The Decline?

http://www.nasdaq.com/symbol/grpn/interactive-chart?timeframe=1y

Funding – 1137 mln.$

Groupon Unique Visitors

http://go-digital.net/blog/2012/04/groupon-settling-into-new-steady-state-lower-users-but-more-usage-per-user/

Michael Porter’s Five Forces (1)

• Threat of New Entrants:• Low barriers to entry and easy to copy;

• Low switching costs;

• Low capital required;

• Low regulatory restrictions.

• Threat of Substitutes:• Many substitutes: paper coupons, discount websites, auction websites.

• Competitive Rivalry:• Many players: e-businesses and also regular product service shops.

Competitor Analysis

Michael Porter’s Five Forces (2)

• Bargaining Power of Suppliers:

• Increasing as number of players increases;

• Choose the market themselves.

• Bargaining Power of Consumers:

• Low switching costs;

• Priced-Based deals: No brand loyalty, one time deal seekers and

buyers;

• High demand for better deals.

PESTEL Analysis• Technological:

• Fast developing environment;• E-business flexibility;• Real time;• Dealing via phones/iPads.

• Environmental:• Works in every market.

• Legal:• International e-commerce low.

• Political:• Government stability;• Tax policies.

• Economic:• Recession;• Currency fluctuating;• Developing vs. Developed

countries.

• Social:• Culture differences;• Ageing population.

SWOT Analysis

Strenghts:

Original idea – first mover in the industry;

Largest company in the daily deals market;

Name – recognition internationally (in over 44

countries);

Diversified into new markets;

E-business company let it be more flexible in

strategic.

Weaknesses:

Negative online reviews;

Emails preceived as spam;

No creation of customer loyality;

Deals not profitable for merchants;

Rapid growth into other countries.

Opportunities:

Continue to develop business on apps for phones,

tablets;

Increase deal variety;

Expand domestic areas;

Partner with big companies;

Threats:

One time users;

Lack of deal personalization;

New entrants too the industry;

Huge competition;

Economic slow down.

Groupon Problems

• No customer loyalty;

• Improper marketing/advertising

strategies;

• Improper financial reporting;

• Lack of proper management.

Recommendations• Advise the businesses on how to best structure and operate a deal:• Number of employee's;• Upsell;• Follow up.

Deal management consulting services

• Collect data about customers;• Offer each customer the most relevant deals;• Exclude the businesses existing customers.

Deal customization

• Target the „luxury“ businesses category.Higher value

• Provide a feedback platform;• Identify „best“ businesses and build stronger long-term

relationships.Filtering mechanism

• Apply standardized accounting methods.Accounting

Conclusions

For solving part of these problems Groupon need to implement CRM.

Thank You For Attention!

References:• D.Buchler, J.M. Downey, A.Goldstein, A.Kheyfets, L.Monitz, T.M.Truong. (2012). Groupon:

What a Deal. MBA.

• B.Popper. (2013). Greed is Groupon can anyone save the company from itself? (http://

www.theverge.com/2013/3/13/4079280/greed-is-groupon-can-anyone-save-the-company

-from-itself

)

• The Wall Street Journal. (2011). Groupon’s Terms Not Endearing. Http://

online.wsj.com/article/SB10001424052702304314404576413663290520884.html

• The Wall Street Journal. (2011). Groupon’s Terms Not Endearing. http://

online.wsj.com/article/SB10001424052702304314404576413663290520884.html

• ChiefMarketer.com. (2011). Can Groupon Grow Up?

• T.Slade, O.Hawkins, T.Teng. (2012). Groupon, INC. Grifin consulting group.