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Wait, both Groupon AND LivingSocial are running Super Bowl ads? Can we declare this a bubble yet? PLEASE?

• klbarry 16y ago
  How can it be a bubble? Their money isn't based on investments that hope for future earnings, but from their own yearly, insane profits.
  • michaeldhopkins 16y ago
    If the group coupon concept is a fad but valued by investors as something more, than the concept is a bubble.
    • michaeldhopkins 16y ago
      Why the downvote? Companies are priced based on potential earnings as well as actual earnings. For example, the potential earnings of collateralized mortgages were thought to be high, so the companies that owned them were priced to account for that. When it turned out that owning CMOs was a bad business model, the companies' market values dropped, costing investors money. And, there is no difference between people stopping mortgage payments and people stopping coupon purchases when it comes to earnings projections.
• notahacker 16y ago
  They can afford to pay for the ads out of the profit they're making. Assuming the various established UK price comparison sites aren't all wasting their money saturating TV advertising schedules, TV advertising is actually pretty good at grabbing the attention of the not especially tech savvy bargain hunter. Moreover, even if SuperBowl ads aren't good at getting consumers to start spending money through them, it's a very high-profile way of showing their ability to reach a much wider audience to the businesses they partner with. They're the type of companies for which brand advertising makes perfect sense.