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ByAmrita Singh
Maha AlsubaieRichard Boulanger
Agenda
• About GROUPON : History, Development & Growth• Porters five forces analysis• SWOT Analysis• Corporate Level Strategy • Business Level Strategy • Structure and Control System• Recommendations
History
• Established in November 2008 in Chicago• Andrew D. Mason, Founder and Former CEO• Fastest growing company of the decade• It all started as The Point• The Points’ failure gave birth to GROUPON• Eric Lefkofsky provided $1 million to develop
the idea.• First deal was 50% off offer for pizzas.
• Few dozen to 350+ employees in a year and a half
• Worth $1.32 billions in 16 months. The only website who did that after YouTube.
Development
• Expanded to international market.• By 2011 they were present in 175 North
American Market and 47 globally.
Growth
• Expanded over 48 countries and 500 markets• TMON & ideeli acquisitions• Over 44.9 million active customers, 46% alone in
North America.• 200+ million global subscribers, 400+ million deals
sold to date, 70+ million mobile downloads and over 650,000 merchants.
• Witnessed more than 33 million downloads in 2013.
Mission
“To become the world's commerce operating system.
By connecting buyers and sellers through price and discovery, we have the
opportunity to become one of the world's essential companies, a daily
habit for our customers and merchant partners.”
Porter’s Model
SWOT Analysis STRENGTHS WEAKNESSES
Attracts every deal seekers Large number of customers do not return
Variety of products and services High cost of customer acquisition
Increasing daily deals with no physical storage. No switching cost for merchants and customers
Big consumer database and merchandise Many time merchants do not see value
First mover advantage Easy to copy business model
Increasing its presence in market aggressively
OPPORTUNITIES THREATSBuild relationship with merchants/partners for return business
Large and well funded competitors like, Google, LivingSocial
Build brand loyalty by ensuring customer return Large number of niche competitors
Increasingly targeted deals - Personalization Barriers of technology, not everyone has internet.
Corporate Level Strategy
• Top tier retail commerce platform
• Economies of networking (bulk buying)
• Customized targeted sales (based on data collected)
• CaaS (Commerce as a Service)
• Change in focus from ‘daily deals’ to a retail good business.
Business Level Strategy
• Due to Groupon being a ‘one trick pony’ their business strategy is similar
to their Corporate strategy.
• Recently starting to segment their business units.
– Retail (Goods) - Food
– Travel (Getaways) - Reserve *limited locations*
Structure and Control
• Recently ousted CEO Andrew Mason
• Major shift in aligning IT resources. (Web & Mobile)
• Geographically diverse sales team
Recommendations
• Loyalty Program
• Improve Customer Service
• Promote API for external venders
• Focus more on Luxury items (+margins)
• Expand geo-location features
• Grew in the area of arts and entertainment
• Advertise on various media channels
• Global Expansion
Resources
• http://money.msn.com/top-stocks/post--groupon-makes-a-big-strategy-
shift
• http://en.wikipedia.org/wiki/Groupon
• http://www.forbes.com/sites/greatspeculations/2014/02/21/groupon-is-
still-finding-the-right-mix/
• https://blog.groupon.com/
Q & A
