Groupon a Chicago-based company, offers discounts through quantity purchase and is the predecessor to the Point website founded by CEO Andrew Mason. Mason and his team launched Groupon in November 2008 using the framework from The Point concept. Their aim was to help metropolitan inhabitants obtain affordable goods and services without overpowering them by the utter number of choices. Groupon first offered one deal per day, in 2009 and 2010; Groupon was experiencing a rapid growth and soon serving over 150 markets nationally and throughout 100 additional markets transnationally.
Their overnight success drew attention from different industries that wanted a piece of the daily discount. During the same period, Groupon saw several competitors and copycat firms entering Living Social; Buy With Me, and “Deals" section on social media pages like Facebook.
Groupon has attracted interest from investors, Digital Sky Technologies being one of their strongest partners. In April 2010, Groupon and Digital
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The TLC show Extreme Couponing has revived bargain hunting and turned it into a game. The goal is to discover ways to combine manufacturer's discounts with your local store rebates to come away with the biggest savings. Discount websites approximating Amazon and Overstock are substitutes; online auctions sites like eBay or other online options to use.
Bargaining Power of Suppliers- Groupon produced powerful margins of over 50% of all their sales generated. Every time Groupon sold a chit to a consumer, it collects payment first. Merchant’s earnings can average about 60% worldwide, is settled later sometimes much later. (3)
Accumulating payments in advance is what predominantly financed Groupons intensive marketing and operational efforts. This once seemed like an excellent way to develop the company faster than its competition, but at the same time, it may now become their