Is Groupon business model sustainable?

While Groupon’s model is simple, it isn’t sustainable, for two reasons. This means that Groupon must spend heavily on advertising to push these products and services on the top of their list, which certainly has a negative impact on the company bottom line.

What is Groupon value proposition?

Groupon’s value proposition to its clients is the offer of low prices for items that the customer wants together with convenience and accessibility. The deals are localized to ensure that the right people are offered the right deal.

Why is Groupon not doing well?

After its overheated IPO and first incarnation, Groupon positioned itself as a matchmaker between customers wanting deals and vendors in search of new customers, and it “did not do very well with that, either,” Clemons says. Shops were driven into bankruptcy because Groupon sold thousands of items below cost.

Is Groupon a thing anymore?

Groupon’s 10-year run as an independent company could be coming to an end. Today, Groupon is valued at just $2.4 billion after a years-long decline in the daily deals category; Groupon acquired its principal competitor LivingSocial for $0 in 2016.

Does Groupon have a sustainable competitive advantage?

The answer to that one is simple — Groupon, a service that keeps half the proceeds from discounts that connect consumers to local merchants — has no competitive advantage and can’t get one. Value Creation happens when customers use a product because it meets their needs better than the competition’s.

What is the value of Groupon to merchants?

Groupon keeps 50 percent of the revenues from each coupon deal. If you do the math, merchants need to gross margins well in excess of 50 percent for Groupon to work for them. The promotion is very steep, usually 50 percent or more.

Is Groupon on the decline?

Groupon stock has declined 40\% YTD, and we believe Mr. Market has been unforgiving on the back of the recent progress made by the company. Lackluster revenue growth is almost a certainty for the remainder of 2021, but we believe investors need to dig a little deeper and go beyond reported revenue.

Which countries does Groupon operate in?

Groupon has served markets in several countries including, the United States, Canada, Ukraine, Germany, Greece, France, the Netherlands, Belgium, the United Kingdom, India, Indonesia, Ireland, Israel, Denmark, Thailand, United Arab Emirates, New Zealand and others.

Are Groupon goods authentic?

Groupon is definitely a legit company. It was founded in 2008, and since then, has grown to serve almost 50 million active users. Very few people have issues using these online coupons due to the fact that as soon as a fraudulent offer is revealed by one user, it would be removed instantly.

Where does Groupon get their products?

Groupon earns its money through a commission it generates on every coupon it sells. Retailers and businesses that offer their goods and services on the site are promised a minimum number of deals that are sold. When that threshold is reached, each deal coupon that is sold earns Groupon a 50\% commission.

How does Groupon use information technology?

It operates by sending emails, website links, and mobile applications. It uses these platforms to reach their subscribers. This paper seeks to discuss how Information Technology helps Groupon to compete in its target market. It also discusses whether or not the company has a sustainable competitive advantage.