Groupon, Inc.: Daily Deal or Lasting Success? Synopsis A couple of years after graduating from Northwestern, Andrew Mason came up with an idea for a startup company. This idea originated from the “tipping point” principle where a group of people leveraged their buying power (Falcone et al., 2012). This concept resulted in Andrew Mason starting Groupon, Inc. in “2008. The company’s name was a result of combining the words “group” and “coupon.” His initial idea grew into a daily deals service that relied on the power of groups” (Falcone et al., 2012). Groupon recruited companies to offer discounts in the form of online deals based on this principle. When enough coupons were purchased, it would reach the tipping point, so consumers received …show more content…
Groupon could focus on superior customer service or technical capabilities, or the company could focus on leveraging exclusive contracts with key merchants to separate Groupon’s service from competitors. The company needs to leverage their capabilities to form competitive advantages such as their brand name as the service provider for daily deals. “The sources of tomorrow’s competitive advantages are the skills and assets of the organization” (Lamb et al., 2017). I also suggest that the company consider a diversification strategy in order to add new products and services that might work with its current model or enhance it. Other options include strategic alliances or partnerships as a way to improve the company’s …show more content…
The company needs to find effective ways to cut costs by streamlining and possibly cross-training employees to be more efficient. The company employed a sales team, customer service representatives, editorial staff, marketing planners, merchant research and services teams, and city planners. The company needs to evaluate the roles of these employees and create a more efficient organization because it is not conducive to being profitable. In order to address this issue, I recommend a successful downsizing or rightsizing plan that includes “eliminating unnecessary tasks, contracting out work when it is cheaper, investing in remaining employees, and developing value-added jobs to balance out job elimination” (Wheelen et al., 2015). Communication is the key a successful and positive