Groupon Business Model and Market Analysis

Groupon is a deal-of-the-day service in North America. According to Wikipedia, the company offers one "Groupon" per day in each of the markets it serves. The Groupon works as an assurance contract using ThePoint's platform: if a certain number of people sign up for the offer, then the deal becomes available to all; if the predetermined minimum is not met, no one gets the deal that day. This reduces risk for retailers, who can treat the coupons as quantity discount as well as sales promotion tools. Groupon makes money by getting a cut of the deal from the retailers.

Here's Groupon's description of the service

Groupon is emerging as a new monetization model for online community and social network. In the following slides, Christian provided a concise analysis of the revenue model and market analysis.

Comments

[Contus]

Groupon makes its money by taking a cut from the businesses so the increased competition will drive that price down..

[inventory pos system]

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