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This is completely made up. In fact about 90% of Groupon deals are profitable for the merchant in themselves.
by pg 14y ago
This is completely made up. In fact about 90% of Groupon deals are profitable for the merchant in themselves.
- salman89 14y agoCan't see how this is true, whether or not someone at Groupon said it was. How can a business who places a deal at a large discount and is paying Groupon a significant cut be making money on the deal itself? Is the redemption rate of these deals so low that it makes up for the price cut + fee?
- ryanwaggoner 14y agoReally? Do you have a source for that? Most of the deals I see are for things like restaurants, which have really slim margins. I'm having trouble understanding how they could give away 75% of their revenue and still come out ahead on the first sale, even with upsells and including customer acquisition in that 75%. Regardless, it doesn't seem to be completely made up; the guy provides sources and math.
- pbiggar 14y agoRestaurants have slim margins on food, but great margins on wine. (The target article 404s, so I have no idea whether it discusses this)
- pg 14y agoYes; I learned that from a friend who works at Groupon and is familiar with all their numbers.
- robg 14y agoYou expect an honest accounting from an internal source?
- pg 14y agoI don't expect my friends to lie to me.
- deleted 14y ago[deleted]
- robg 14y agoEven given the best intentions, why assume their information is accurate? Aren't public companies incentivized to bias evidence to their utmost favor? 90% seems so high it fails the sniff test but I could easily see how it's a figure passed around internally. I'm just surprised you accept (and now promote) that number as fact.
- pg 14y agoMy friend is high enough at Groupon to know accurate numbers. I'm not sure what more I can say that would satisfy you. Can we stop now?
- opminion 14y agohttp://www.aaronsw.com/weblog/acsoi http://www.aaronsw.com/weblog/acsoi last two paragraphs might help explain discrepancy.