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Essay on Groupon: a Comprehensive Study

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Groupon: A comprehensive Strategy TM583 – Course Project By Jesse Marcano Cory Shenault Clifton Leonard Table of Contents Introduction 2 Section 1 - Strategy 3 Section 2 – Core Competencies 6 Section 3 – Industry Dynamics 10 Section 4 – Technology Sourcing and Internal Innovation 13 Section 5 – Product Development Strategy 16 Section 6 – Strategy to Protect Innovations 17 Conclusion 20 Bibliography 20 Introduction Groupon did not invent the daily deal website; however, they introduced the concept of using the group buying power of online shoppers to receive substantial discounts from local merchants. Their model has been easy to replicate, which has lead to many clones operating in the same market as …show more content…

“In May of 2010, Groupon moved 19,822 tickets in eight hours and split the $238,000 profit with the tour operator” (Steiner, 2010). Groupon has since established a presence in 88 U.S. cities as well as 22 countries including Poland, Russia, Chile, and Turkey. With competition getting stronger in Brazil and New York, Andrew Mason hired 250 salespeople and 70 writers. Many of those writers were chosen from the improv comic strip in Chicago to create witty and unique sales pitches for upcoming deals. “We want to do for local e-commerce what Amazon did for normal consumer goods,” said Mason (Steiner, 2010). As of March 17, 2011, Groupon has acquired more than 70 billion subscribers worldwide. Groupon’s primary strategy for growth is sales and marketing. They use complex analytics to segment customers not only by city but more specifically, by neighborhood. They target these customers with marketing that is close to home and relevant to their demographic. They provide local businesses with instant access to droves of local customers and in exchange they split the revenue from the sales of “groupons” with the local businesses. Groupon’s market name recognition and vast data warehouses containing intimate customer data give them an advantage over competitors. They use this data to buy Google Ad Words that will attract the most customers and provide an

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