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Strategies & Market Trends : BAK - Investing
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To: hdl who wrote (2871)6/5/2012 10:21:00 AM
From: XoFruitCake1 Recommendation  Read Replies (1) of 3249
 
Re: At what price would you buy GRPN?

groupon is known. why can't groupon have businesses come to their website or call in and sign up?
Because of competition and the coupon term is also unique between deal (i.e. a lot of negotiation between the business and GPRN like service). The deal can range from the business pay Groupon to run the promotion to the business and Groupon share the revenue stream from selling the coupon online. Competition is what will eventually kill Grpn's profit margin. Small business only have so many capacity to serve new customers. Any online coupon service can fill their coupon needs. So as all of these services grow and compete for new business in a local market, the term get better and better tilting toward the business and the profit margin just get creamed. Since all the coupon buyers are group together by their geography, it is like GRPN is running many small region firms that specialize in a local area (knowledge of the companies in the area, taste of customers, etc. etc.) that is human intensive and small firm work better than a big national firm (at least they have a very good fighting chance). They need to be selective about their coupon offering, otherwise they will drive away the coupon buyers with all the crappy offering and that demand local knowledge and local operation.
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