Strategic Management of Technological Innovation by Melissa Schilling

Groupon is a deal based business that brings customers discounted deals from the businesses. As a result of massive success and the growing competition, the business is faced with the option of either selling to Google or developing an effective marketing strategy for continuing its own. In the due context, the underlying report proposes a marketing plan for successfully dealing with the market challenges (Chatterjee, O”Keeffe, and Streiff, 2012).

Throughout this question, ignore all of Groupon’s costs other than the $150 paid to the merchant. The offer is announced on August 1st and it requires 100 customers to purchase the deal so that the deal goes through. For all of the questions below, if no transaction should be recorded, please explain why.

Groupon is an internet website company focused on generating revenue by utilizing relationships with merchants to provide consumers with discounts on select items. The goal of the discounted vouchers is to drive additional consumer store traffic and generate revenue for merchants which are shared with Groupon via a predetermined contractual percentage. Groupon generates visibility and exposure with email and social networking to increase consumer spending at specific merchants. Groupon has many features from personalization of product offerings to specific demographics and target segments. In addition, a more defined value proposition allowing merchants an opportunity to showcase their own product offerings on

Andrew Mason, Founder & CEO of Groupon, had a big idea, but was not aware how massive it could grow. Before Groupon, Mason begun a website called ThePoint.org as a site for collective action, to get groups of people together to solve public and social issues. It wasn’t as effective as he projected, and so started to think of how he could take the group approach of ThePoint.org and turn it into a business channel. Mason believed the Internet had potential to change how people discover and buy from local businesses. That’s when Andrew Mason came up with the excellent concept for Groupon. “Part of Groupon’s success is the simplicity of its business model…” (Kerin & Hartley, p. 110) Groupon offers “Deal of the Day” coupons from local and nationwide

In 2011, the director of staffing for coupons.com Ken Perluss, saw the need for a manageable system to find the right employees to keep up with the growing size of coupons.com. Purluss looked to Jobvite Hire and found the perfect match with them. With Jobvite Hire, coupons.com was able to fulfill their plan to double the size in employees in as little as six months (http://www.jobvite.com/portfolio/couponsdotcom/). It was interesting to find that in 2014, Retailer iQ was launched. Retailer iQ personalizes coupons sent to customers found in the companies database, sending customers items that interest and suit their needs (coupons.com ,2015). With the introduction of Retailer iQ, digital coupon transactions increased nearly 70% going from the second half of 2014 into the first half of 2015 (“coupons.com Incorporated”, 2015). Additionally, it was impressive to see that when coupons.com first filed for an IPO they opened the stock price at $16 and were able to trade for $31.22 (McGarth, 2014).

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

Groupon is a deal of-the-day site giving top notch rebates on products or administrations for occupants of a specific market. This deal as of now exists in more than 150 urban communities in North America and in more than 100 around the world. Essentially, Groupon highlights an area particular coupon every day, and the offer just winds up plainly substantial if a specific number of individuals additionally buy the rebate (subsequently the name-a straightforward blend of the words "Amass Coupon").

Andrew and his partner, Eric Lefkofsky came up with another company and created Groupon, which launched in November 2008 where it first started in Chicago. Eric provided Andrew $1 million in “seed money” to drop out of school and got Groupon started because Eric developed the idea. Groupon’s first deal was to buy two pizzas for the price of one in a restaurant on first floor of the building where Groupon started.

Lastly, Nail 21 should offer a discount on Groupon because it is a common platform for many people to find steep discounts that will make them want to try new things. According to Early Gift Card Redemption Could Help Stores Grow Business Faster by Mario J. Miranda, he says “The results of this study suggest that store promotions facilitate moving gift card recipients from a state of volition control to elaborating on the potential of adding value to the gift vouchers, inevitably bringing forward the hierarchy of effects that expedite consumers becoming regular store patrons who gift the store's vouchers to others”.

Despite the small sizes of merchants, Groupon maintained a high-touch relationship to fulfill its customer-service philosophy. The growth in Groupon sales force reflected international operations. This resulted in a high revenue increase of Groupon Company by 380% in 2011. This rise in revenue was attributed to an increase in marketing expenditure and enhanced company’s sales force. Despite the significant growth in income, the company’s operating income remained flat.

As Groupon is established in many countries of the world, a global strategy has to be pursued

Groupon is a deal-of-the-day website that is localized to major geographic markets worldwide. Launched in November 2008, the first market for Groupon was Chicago, followed soon thereafter by Boston, New York City, and Toronto. Groupon has over 50 million subscribers across 300 cities in more than 40 countries. The idea for Groupon was created by Andrew Mason who is currently the company’s CEO. [update]Groupon serves more than 150 markets in North America and 100 markets in Europe, Asia and South America and has amassed 60 million registered users. The growth in the future is likely to be at a slower pace, primarily because the company is already one of the largest in the local deals space.

In my opinion Groupon is not a ready-to-go solution to the problem of low marketing budgets of many local merchants. If Groupon is good

With the internet technology, everyone can stay at home for online shopping. What’s more, if you can enjoy daily discounts with all the information, home delivery and 24-hours daily operation, that’s all can be found by buying Groupon. Groupon, the company has successfully captured millions of online consumers throughout the world. The marketing strategy of Groupon captures the consumer behavior. Consumer buying behavior, defined as... “The buying behavior of final consumers, individual and households who buy goods and services for personal”.Groupon consumers mainly responses to:

Groupon has provided value to the business. One of their key benefits is to gain new customers by their bulk discounts. After using Groupon customers learn its benefits and will continue using it due to its discount, not only that if the business provides quality