In the last installment of this series, Groupon had ascended Mt. High to become the champion of the tech world. When Google, Undisputed King of the Internet, sought to purchase Groupon and bring the company into the Tech Billionaire Pantheon, Groupon rejected the offer, shocking millions! And now the thrilling conclusion!
After Groupon spurned Google’s $6 billion offer – an offer that showed the confidence Google had for Groupon in the long-term – attention turned to why Groupon would do such a thing: they had to believe the company was worth more than $6BN, and that only meant one thing: going public.
Groupon’s success led to an announcement and subsequent cancellation of their IPO. Contentious financial information, snarky blog posts and the CEO breaking a cardinal rule of the “quiet period” by sending a memo to Groupon employees defending the company’s ability to perform amidst bad press marred the whole ordeal.
Groupon came under fire of accusations saying the company operated like a Ponzi scheme and more stories of merchants’ bad experiences with the company came to light. Some businesses had too many customers, an issue addressed on the Groublogpon by Andrew Mason himself. Other businesses claim they did not sign a deal with Groupon, but were greeted with hundreds of Groupon waving customers demanding half-priced services. By this time Groupon’s stable of merchants were advertising deals on everything from egg breakfasts to Chicago gay events. The bad press, clumsy IPO, perceived over-valuation, and controversial Super Bowl commercial had significantly cooled Groupon’s white-hot streak.
General handwringing and unease about the future of Groupon ensued. Despite this, the power and influence the company had to revive local economies is higher than ever, especially with the launch of their new Now service.
Groupon Now is the company’s hyper-local, mobile, deal-finding service designed especially for smartphones. The initiative is designed to expand daily deal service, and take aim at people on the go and the businesses all around them. Now is built on the idea that offering a deal will bring new, repeat customers into a business. Even if it didn’t work that way all the time, Groupon was the company that completely transformed local economies throughout the country. Customers interacted with businesses differently and new distribution channels emerged as a result of this new approach.
Groupon Now has become an extension of that by harnessing the power of mobile Internet and giving merchants more power to set the rules for deals and have more limited windows for purchase. For example, a merchant could say that between 9 a.m. and 4 p.m. on any particular day, people could get a half-priced burger and Groupon subscribers in the vicinity would get a notification. Rather than catch people at home on their computers, Groupon Now targets the tens of millions of Americans on smartphones in metropolitan areas.
Despite competition and the recent drop in stock price, Groupon continues to be an innovator in the space and it’s not likely they’ll be going anywhere soon.