Are Groupon's Days Numbered?

Fiver

Fiver

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Jan 30, 2009
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Hmmm...maybe should've sold to Google and taken the 6 Billion after all.

But Groupon’s biggest victims are the small businesses that get suckered in to accepting Groupons. Restaurants lose money on them because consumers flood the restaurants, order very low priced meals, strain waiters and cooks, get lousy service, and never return.
Examples abound. As I wrote in June 2011, a restaurant in Portland, Ore. believes its decision to work with Groupon was its worst business decision ever – costing it $8,000. And according to the New York Times, Muddy’s Coffeehouse –it serves coffee and granola – had to take out a loan to cover its Groupon losses.

Muddy’s gave Groupon customers $24 worth of food and coffee for $12. It paid Groupon half of its revenues, drew in crowds, lost money, and would have shut down were it not for that loan. As owner, Dyer Price, told the Times, “They don’t warn you that you’re going to get hit really hard and that you have to be prepared. We will never, ever do it again.”
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Why Groupon Is Over and Facebook And Twitter Should Follow - Forbes

Why Has Groupon Lost 80% of Its Value Since IPO?: Video - Bloomberg
 


“They don’t warn you that you’re going to get hit really hard and that you have to be prepared. We will never, ever do it again.”
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Ok. Maybe you can be prepared next time and learn how to effectively utilize it?
 
Groupon is not scalable. They have too many expenses to hire salesmen. Plus no one that buys at a discount converts to a loyal follower of the business.
 
Gambit said:
Groupon is not scalable. They have too many expenses to hire salesmen. Plus no one that buys at a discount converts to a loyal follower of the business.
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This is the issue. You're getting customers, but these customers are price shoppers. If you're not the cheapest in town, then they'll find the vendor who is.
 
agree, I never understood the hype over this site. You have to be one big broke-ass motherfucker to waste your time looking up deals in there.
 
Their whole model was to churn and burn as many businesses as possible. Its like they burnt down the whole forest as fast as possible. I have yet to hear one success story from a local business that hosted a groupon.
 
Copied from my facebook wall:

Moral of the story...when Google comes knocking and offers $6bb, you say "SOLD", give them your bank wire info and go pick out the carpet in your new jet. Idiots.
 
It's a load of bollox..

There is a novelty factor for bargain hunters for a month after signing up.. Buy a few cheap things and realize the businesses advertising on it are ones on the way to being bust .. or they are struggling for a reason (dump cafes etc)..

The wife and all her friends have given up on it after buying shit spa days for hotels which were like something from the 1970's..

Her own silly fault ha..
 
blogspotter said:
Copied from my facebook wall:

Moral of the story...when Google comes knocking and offers $6bb, you say "SOLD", give them your bank wire info and go pick out the carpet in your new jet. Idiots.
Click to expand...

I'd be interested to know how much money the founders have made from the IPO and taking out company money etc.

You don't know how many years that $6bn would have been over and what google would have wanted, performance wise for the full amount to be paid.

The actual founders probably made more this way.
 
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