Even if you assume that current customers require little marketing effort (which is a huge assumption), what about the businesses? Let's apply the same logic t

Even if you assume that current customers require little marketing effort (which is a huge assumption), what about the businesses? Let's apply the same logic to GroupOn's business customers: once they acquire a customer through a GroupOn, that customer will remain loyal and they don't need to market to them again. In other words, that business doesn't have to offer sharp discounts for quite a long time, and therefore ceases to become a GroupOn customer. So, GroupOn needs to spend more on marketing to get new businesses to offer deals. Sure, it's plausible that if they stop marketing, they still have a business. That's certainly the story they are trying to tell. But accounting is not about plausible-sounding stories. It's about cold, hard numbers in black and white.