Groupon basically offers "deals" to a mailing list and provides an incentive for members of the mailing list to get others on the mailing list.
What are the barriers to entry? Not much, their are many clones. You can get the software out of the box. Then you need a mailing list and merchants. Find a niche, any niche. Couptessa, living social, dealon...
But Groupon is worth 30% of Facebook?
The same as Best Buy, HG Heinz, and Marriot International?
Microsoft in only 16 times the value and Apple 21 times?
Ebay is 2.5 times? Amazon 5.5 times?
The valuation is insane.
More on the business model. Groupon keeps 50% of revenue from the deals, just for sending an email. Might price (meaning %) competition creep in?
If people learn that only half the revenue goes the merchant might they start to wonder how it is such a good deal? Merchants are doubtfully loosing money on the deals, so the pre-deal prices quoted are either inflated or the merchants are very high margins since the typical deal is 50% of regular price. So the merchant is willing to accept 25% of the typical price? I doubt it. And when people realize that the deals are not really deals, then the bubble that is Groupon will collapse toward the profitability of another coupon provider.
I wonder if Valpack has considered a competing service? Seriously. They have the local sales force and relationships with businesses offering discounts. Start building lists and get it on with Groupon.
More curiosities:
$15 000 000 000 value/ 24 000 employees = 625 000/employee
Not a typical valuation method by indicates how much you could spend building a rival organization.
More curiosities:
$15 000 000 000 value/ 24 000 employees = 625 000/employee
Not a typical valuation method by indicates how much you could spend building a rival organization.
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