5 ms·
Wow, now there's a loaded question. Why don't you just ask us whether we're gonna stop beating our wives? The reasons to be skeptical of Groupon are well docum
by hugh3 15y ago
Wow, now there's a loaded question. Why don't you just ask us whether we're gonna stop beating our wives?
The reasons to be skeptical of Groupon are well documented. Not that it's a bad business, by any means, it's just that it's an industry with low barriers to entry and many competitors, and Groupon's early success is unsustainable since it was built on persuading businesses to offer ridiculously good deals which are likely to lose them money; businesses are wising up to this, deals are getting worse, people are getting less interested, and in general the whole social-coupon industry seems to be settling into a new equilibrium in which a $10^10 valuation for Groupon seems excessive.
- byrneseyeview 15y agoI used to think it was an industry with low barriers to entry, as did lots of people who have lost lots of money on Groupon clones. I'm not sure why, but it turns out to be a really tough business for all but a few companies.
- Woost 15y agoGroupon's business is basically all sales and marketing. The v1 tech behind the deal-a-day offerings is trivial. (leaving aside recommendations and such) You need to be very good at signing up businesses and getting good terms for your company to succeed. In addition, you need to figure out how to get a stable base of customers of your site. Basically, Groupon clones have very low technical barriers to entry, but if you don't have a really good sales and marketing staff you're in trouble.
- pbreit 15y agoIt has natural monopoly-like characteristics: buyers go where the best deals are, sellers go where the most buyers are.