Prepared by the students of strategic management at the MBA program of IE Business School, this presentation analyzes Groupon’s position in the US market, the pitfalls in its current business model and recommends solutions for sustainable growth
Update: I have added two slides towards the end discussing the IPO
This is a presentation I made for my students. It covers different aspects of Groupon case, including marketing, finance, accounting, and corporate governance.
Update: I have added two slides towards the end discussing the IPO
This is a presentation I made for my students. It covers different aspects of Groupon case, including marketing, finance, accounting, and corporate governance.
Across the globe, as the novel coronavirus moves us from communal spaces into the confinement of our homes, our social experiences are forced to adapt. Beyond the social networks we already know and use, we are finding new ways to integrate social into our online lives.
While marketers in across the globe look for social media as an essential part of marketing campaign, china is looking at it as the backbone of consumer engagement. The technologies used by them are dramatically different from what we have seen so far in the west
have you heard about PINDUODUO?
Its an app which started in 2015, and in the span of 5 years Pinduoduo and their social-shopping approach has poised to fully capture the offline-to-online transition in commerce. The success of Pinduoduo in China suggests there is a huge opportunity for social commerce platforms to emerge in other regions.
You know what makes it unique from all the others apps in the ecommerce sector?
Here are the slides to find out!
Credits: @siddeshkhande @shikhachowhan
#uniquebusinesses #ecommerce #socialbranding #pinduoduo #marketing #newstrategies #wechatmarketing #modernstrategies #learnerengagement #china # #engagement #opportunity
This presentation is about googles HRM practices and the following topics are covered in this presentation:
Introduction(Google's)
Job Analysis & Design
Recruitment and Selection
Training
performance Management
Compensation and Career Development
This is an example of an investment memo for a consumer products company, Kraft Heinz. This does not constitute investment advice and is an outdated valuation. This should only serve educational purposes.
Across the globe, as the novel coronavirus moves us from communal spaces into the confinement of our homes, our social experiences are forced to adapt. Beyond the social networks we already know and use, we are finding new ways to integrate social into our online lives.
While marketers in across the globe look for social media as an essential part of marketing campaign, china is looking at it as the backbone of consumer engagement. The technologies used by them are dramatically different from what we have seen so far in the west
have you heard about PINDUODUO?
Its an app which started in 2015, and in the span of 5 years Pinduoduo and their social-shopping approach has poised to fully capture the offline-to-online transition in commerce. The success of Pinduoduo in China suggests there is a huge opportunity for social commerce platforms to emerge in other regions.
You know what makes it unique from all the others apps in the ecommerce sector?
Here are the slides to find out!
Credits: @siddeshkhande @shikhachowhan
#uniquebusinesses #ecommerce #socialbranding #pinduoduo #marketing #newstrategies #wechatmarketing #modernstrategies #learnerengagement #china # #engagement #opportunity
This presentation is about googles HRM practices and the following topics are covered in this presentation:
Introduction(Google's)
Job Analysis & Design
Recruitment and Selection
Training
performance Management
Compensation and Career Development
This is an example of an investment memo for a consumer products company, Kraft Heinz. This does not constitute investment advice and is an outdated valuation. This should only serve educational purposes.
Term paper for Fall 2013 Accounting Research course. I found enough material for a much longer paper. However, the requirements limited me to only seven pages, including references.
The business model canvas applied to analyze Groupon business model, a peculiar form of double sided platform. Part of my personal marketing research at www.marketingespresso.net
This was our final Series A deck. Read more about raising the round in this blog post:
https://medium.com/@DanielleMorrill/welcome-brad-feld-to-the-mattermark-team-announcing-our-6-5m-series-a-dd9532fc1b39
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We will dig deeper into:
1. How to capture video testimonials that convert from your audience 🎥
2. How to leverage your testimonials to boost your sales 💲
3. How you can capture more CRM data to understand your audience better through video testimonials. 📊
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This insightful presentation is designed to equip entrepreneurs with the essential knowledge and tools needed to accurately value their businesses. Understanding business valuation is crucial for making informed decisions, whether you're seeking investment, planning to sell, or simply want to gauge your company's worth.
Kseniya Leshchenko: Shared development support service model as the way to ma...Lviv Startup Club
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Kyiv PMDay 2024 Summer
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Youtube – https://www.youtube.com/startuplviv
FB – https://www.facebook.com/pmdayconference
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Implicitly or explicitly all competing businesses employ a strategy to select a mix
of marketing resources. Formulating such competitive strategies fundamentally
involves recognizing relationships between elements of the marketing mix (e.g.,
price and product quality), as well as assessing competitive and market conditions
(i.e., industry structure in the language of economics).
Falcon stands out as a top-tier P2P Invoice Discounting platform in India, bridging esteemed blue-chip companies and eager investors. Our goal is to transform the investment landscape in India by establishing a comprehensive destination for borrowers and investors with diverse profiles and needs, all while minimizing risk. What sets Falcon apart is the elimination of intermediaries such as commercial banks and depository institutions, allowing investors to enjoy higher yields.
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What is Enterprise Excellence?
Enterprise Excellence is a holistic approach that's aimed at achieving world-class performance across all aspects of the organization.
What might I learn?
A way to engage all in creating Inclusive Excellence. Lessons from the US military and their parallels to the story of Harry Potter. How belt systems and CI teams can destroy inclusive practices. How leadership language invites people to the party. There are three things leaders can do to engage everyone every day: maximizing psychological safety to create environments where folks learn, contribute, and challenge the status quo.
Who might benefit? Anyone and everyone leading folks from the shop floor to top floor.
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1. Groupon: The road ahead
Anurag Jaiswal
Ignacio Muñiz Garcia
Mariana Penzini
Pedro Oliveira
Roman Viñoly
Shirley Kleinman
IE Business School
2. Agenda
1. Introduction
2. Situation analysis and challenges
a) Internal analysis and challenges
b) External analysis and challenges
3. Recommendation
1
3. What is Groupon?
Groupon is deal-of-the-day website that has grown exponentially worldwide
Selected
deals every
day!
A minimum number of Groupon keeps
people must buy the 50% of the deal
30% to 90% deal for it be valid value
Discount!
Groupon’s growth record Rejects $6B buyout by Raises $950M funding
Expands to Latin Google, and expands to and expands to India
America, Acquires Clan HK, Singapur and Taiwan South Africa and Israel
Descuento
500
Expands to Japan
400 Expands to Europe via and Russia trough
acquisition of CityDeal acquisitions
300 Raises $30 M in a
Deals launched in funding round
200 major US cities
100
0
Apr-09
jun-09
sep-09
oct-09
nov-09
Apr-10
jun-10
sep-10
oct-10
nov-10
jul-09
Aug-09
jul-10
Aug-10
Jan-10
feb-10
Jan-11
feb-11
Dec-09
Dec-10
mar-09
may-09
mar-10
may-10
mar-11
Source: Groupon Reports and neXtup Research
2
4. Local Deals Market
The local deals market in the U.S. is expected to increase at a faster pace than the
overall Online ads market
Local deals market in the US
3,620
3,120
Local Deals Market (Millions)
2,620
2,120
20% CAGR
1,620 3,069
2,557
1,120 2,131
272% CAGR 1,776
1,480
620 1,000
200
120
2009 2010 2011E 2012E 2013E 2014E 2015E
Source: eMarketer and neXtup Research Estimates
3
5. Groupon Performance in the US
The growth seens to be slower and even negative in the last month
Groupon Revenues in US
Millions USD
100 88,9
75,6 80,5
80 61,7
18% CAGR 52,8 54,5
60 45,5
40 26,4 30,5 29,4
20,6 5% CAGR
13,5 19,0
20 10,8
0
Jan-10 feb-10 mar-10 Apr-10 may-10 jun-10 jul-10 Aug-10 sep-10 oct-10 nov-10 Dec-10 Jan-11 feb-11
Source: Groupon website
Groupon.com Unique visitors
Millions
20
15,6 14,7 15,2
15
11,2
22% CAGR 8,3 8,6
10 6,5 7,6
4,6 4,9
5 2,0 2,5 3,1 12% CAGR
1,9
0
Jan-10 feb-10 mar-10 Apr-10 may-10 jun-10 jul-10 Aug-10 sep-10 oct-10 nov-10 Dec-10 Jan-11 feb-11
Source: Compete
4
6. Agenda
1. Introduction
2. Situation analysis and challenges
a) Internal analysis and challenges
b) External analysis and challenges
3. Recommendation
5
7. Groupon main challenges
Groupon is facing both, internal and external challenges
External Challenges
Higher competition
Internal Challenges
Subscribers and Local business low service
6
8. Problems in operations and services – local businesses and customers
Leading to low level of satisfaction and loyalty
Local-businesses face ..to upsell to customers ...and to turn Groupon’s customer
Local difficulty to best for more than the customers to repeat profile changes from
Business structure and face value of the full-price customers deal-savvy to the
operate a deal coupon general population
Only 66% of deals were profitable Only 50% of customers Only 31% of customers
Business NO willing
to collaborate again
Low level of satisfaction and 42%
Repeat customers ? high level of Churn rate 58%
Business willing to
collaborate again
End-customers receive low quality Not redeeming vouchers
End service and bad experience
customers from the local-business
~ 20% breakage rate
Source: Jesse H. Jones Graduate School of Business 7
9. Why revenues are decreasing
The internal service problems are damaging the number of deals and their value
Bad service and experience
# of subscribers from subscribers decrease de
number of deals
Deal Subscribers
Deal per
subscribers ! Bad service and experience from
local business will damage
# of deals Groupon’s negotiation power to offer
Business deals
deals with more gross price and
300 deals # of Local Business discount to customers
demand
!
Deal Local Business
Deal per Local
Business
Groupon Net
Revenues
$ 30.000 Discounted Value Gross price !
$ 200 $ 500
Net deal size
!
$ 100
Groupon Revenues in US Discount to
Millions USD Share to Groupon
100 88,9 customers
75,6 80,5
80
18% CARG 52,8 54,5
61,7 50% 60%
60 45,5
40 26,4 30,5 29,4
19,0 20,6 5% CARG
20 10,8 13,5
0
Jan-10 feb-10 mar-10 Apr-10 may-10 jun-10 jul-10 Aug-10 sep-10 oct-10 nov-10 Dec-10 Jan-11 feb-11
Source: Groupon webside
8
10. Local Deals Industry analysis
Due to the high profitability of the industry and the medium-low strength of the
competitive forces, we expect the entrance of new competitors in the market
Market characterized by network externalities
High strength
Medium strength
Medium bargain power of suppliers Low strength
Moderate power in the hands of the mass
social-media players
– Facebook and Google
Low power of the IT suppliers
Medium threat of new entrants Medium Threat of substitutes
Medium barriers to entry Significant numbers of substitutes
– low capital-intensive nature of the – Other communication tools
business,… Competitors – Coupons catalogues
– …but high network externalities
Low barging power of customers
Business Subscribers
Low bargain power of the business Low bargain power for the subscriber
– Low concentration of business, very atomize – Large number
– Unorganized nature
9
11. Competition analysis
Local deals market is heating up in the US
Our analysis shows that there are the following main competitors in the US.
Here is a comparative analysis with Groupon:
Is deals their Local
core Offers Types of deals Operations Description
business? Sales force
Offers of the day
Local services and
products
Local services and Amazon.com is stakeholder
Offers of the day
products 300+ cities in US
Offers Catalogue
Premium Products
and services 6 metropolitans in US
X Offers of the day
and catalogue
Local services and
products X BETA to be launched in
Portland, Oregon
X Offers catalogue
Local services and
products X Businesses join for free
10
12. Competition analysis
A comparison of services offered
Matrix
Size = subscribers
High Groupon
social
% Gross Margin
Google
Gilt City
Facebook
Low
Low Customized service High
11
13. Competition analysis
A comparison of revenues
Size = Revenues
100%
80%
Average margin per deal
60%
40%
20%
0%
-5 0 5 10 15 20 25 30 35
-20%
Average number of deals offered each day
12
14. Why revenues are decreasing
The competitive increase of the market is putting pressure in the margins
# of subscribers
Deal Subscribers
Deal per
subscribers
# of deals
Business deals
300 deals # of Local Business
demand
Deal Local Business
Deal per Local
Business
Groupon Net
Revenues
$ 30.000 Discounted Value Gross price
$ 200 $ 500
Net deal size
$ 100
100
Groupon Revenues in US
Millions USD
75,6 80,5
88,9
Share to Groupon ! Discount to
customers
80
18% CARG 52,8 54,5
61,7 50% 60%
60 45,5
40 26,4 30,5 29,4
19,0 20,6 5% CARG
20 10,8 13,5
0
Jan-10 feb-10 mar-10 Apr-10 may-10 jun-10 jul-10 Aug-10 sep-10 oct-10 nov-10 Dec-10 Jan-11 feb-11
Source: Groupon webside
13
15. Agenda
1. Introduction
2. Situation analysis and challenges
a) Internal analysis and challenges
b) External analysis and challenges
3. Recommendations
14
16. Recommendations
Strengthen internal capabilities & differentiation to safeguard market-leader position
Recommendation Description Consequence
Advise the businesses on how to best structure and operate a deal
– cap size • High quality of
Deal management service
– Number of employees • Repeat
consulting services
– Upsell customers
– Follow-up
Collect data about customers • Coupon
Deal customization Offer each customer the most relevant deals purchase
• Threat of
Exclude the businesses’ existing customers cannibalization
Provide a feedback platform to both businesses and customers
• Quality of local
Filtering mechanism Block particular customers or take corrective measures against businesses businesses
Identify ”best” businesses and build stronger long-term relationships • Quality of end
customer
Loyalty programs • Customer loyalty
Brand loyalty • Repeat
Improve the customer services to the end-customers customers
• Revenue growth
• Wider customer
Higher value Target the “luxury” businesses category base
• Breakage
15