Groupon Report

Topics: Internet, Customer service, Customer Pages: 8 (2448 words) Published: March 6, 2013
I. Presentation of the firm and its business operations

History :

Groupon is a deal-of-the day website created in 2007 by Andrew Mason and it’s based on the concept of group purchase. Groupon became ‘Groupon City deal’ by acquiring the company ‘City deal’, which was a copy of the concept of Groupon in Europe. The firm is located in more than 40 countries in the world. Description :

The concept is very simple ; indeed, it gives the opportunity to the customers to take advantage of strong discount on a limited duration. There are offers called ‘deals’ which are put on line during 24 hours (or a litlle bit more) and that concern sectors of the well-being, the restoration, travel and leisure activities. The buyers pay directly the ‘deals’ on the website Then, they receive a voucher which allow them to use their “deals” according to the duration of validity registered on this one Organisation of the company :

* Commercial department :
This service is composed of 250 commercials in France. It’s the most important department in the company beacause they have to negotiate offers with their "Partners" and then , they put it on the site * The financial service:

This service has to manage the coupons to paid to the partners or refund customers who were unable to take advantage of their vouchers. * Marketing department :
This service is in charge of the announces on the webite and they strategically define the day of publication of deals. * Presales:
Very numerous. Their missions is to enrich the database of the commercial. They have to be compétitive , that’s why there are 2 or 3 persons are in each city. Business model :
Groupon offers to the customers one good or service per day/per city in each following market concerned. These offers have reduction of 50 to 90%. Offers are on the website or send to the subscribers.

The key for the group purchase is on the fact that customer’s received their product only if a minimum of purchase is reached. (But it is not still the case). On each sale, groupon take 50% of the product price.

Besides, the trader takes no more than 25% of his regular price. This model is economically viable only for traders who have a margin of performance superior to 75%. That’s why Groupon don’t propose basic goods. So we can find on Groupon:

* Some luxury product, which have a large profit margin.
* Some products of rising company who search new customers and want to be known even if they sale at a loss. * Some reductions coupons which push the customer to consumption Demand:
Groupon have some customer fowls who want to save money but who wants to take some pleasure. Groupon is very transparent by publishing the profile of their buyers. These figures allow understanding who is touched by this type of offers. Thus, the average profile of a customer of Groupon is a single woman of superior training between 18 and 34 years, who wins of the order of $90K Activity domains:

Groupon offers its focus on a particular market niche: those of shops and service providers linked to services "personalized" for example we can see promotion about: "trendy restaurants, traditional pubs, lounge bars, fitness centers form, yoga, cooking classes, etc. "

The six main areas of Groupon made ​​promotions are:
- Restaurants
- Leisure (parachute jump)
- Car (oil change)
- Beauty (hairdresser)
- Wellness (spa)
- Travel (hotels)
Strenght| Weaknesses|
* Groupon is the leader in the U.S. and Europe * Large database (more than 150 millions registered in 2012) * Rapid growth (in front of Google and eBay) * Visibility impressive (TV / Internet / newspapers) * Opening of new cities regularly (La baule, Tours, Carcassonne…)| * Enterprise recent growth: problem of adaptation but try to improve * Victim of success, management difficulties (after sales service : not enought employées to answer to the questions) * Turn-over of major sales...
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