What is Groupon?
Groupon is an online-based company that offers special deals on the best stuff to do, eat, see and buy. Groupon works with local businesses to create discounts that are offered to consumers. They call it "collective buying power!"
Each day Groupon offers one special deal available for purchase in 24 hours. The Groupon purchase does not get confirmed until the minimum number of buyers has purchased the deal. If, at the end of 24 hours, the minimum number is not met, your credit card is not charged. The theory here is the collective power of multiple buyers helps drive down the cost, yet ensuring the business doesn't loose too much money by offering such big discounts.
Groupon’s BIG competitor
First, Google tries to buy Groupon for the sum of 6 billion dollars. Groupon says no because all the buzz they are getting is driving up their eventual IPO value. So, Google does the next best thing. They launch a competing service.
The explosiveness of services like Groupon, Living Social and their kind are really no surprise. We’ve been cutting coupons for years. The difference is that now we have the Internet.
Groupon now has a serious competitor, with instant brand recognition.Groupon’s uncontrolled growth has been fueled by our love for a deal and the inevitable nature of the Internet. This will come down to a content war, which service will consistently offer the most attractive deals. From a consumer’s perspective this has the potential to be a huge win. In the other hand, what is good for the consumers is not always good for a business. Discounts do not necessarily build brand loyalty or repeat customers. This is a win for consumers because there will likely be more, better and bigger deals coming our way.
