What Are The Strengths And Weaknesses Of Groupon

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• SWOT analysis Strengths As the pioneer in the daily deals market, Groupon gains the first mover advantage of capturing more market shares and building customer loyalty. By operating in approximately 48 countries worldwide, it acquired strong global brand recognition and foothold in these markets. In recent years, Groupon has attempted to diversify its business into new markets through acquisitions of various related companies. To build on its portfolio of its businesses, Groupon had acquired ideeli in January 2013 to accelerate its presence in the flash fashion scene and Ticket Monster, a Korean e-commerce website in January 2014. These latest strategic shifts from its daily deals business to e-commerce businesses help to mitigate the risks of failure should its core business (i.e. daily deals) continues to suffer from net losses. Weaknesses Groupon relies…show more content…
Customers of Groupon are defined as both suppliers and end customers. It is apparent that Groupon is very weak in retaining customers. In the case of suppliers, the low switching costs and less than impressive effect Groupon provides in increasing customer base causes suppliers to switch to competitors and leave Groupon’s management. As mentioned in the SWOT analysis, many merchants cited that employing Groupon as a local advertising tool is ineffective, expensive and risky. In the case of end customers, similarly, low switching costs and lack of incentives to continue using Groupon does not allow Groupon to tap on a larger, more loyal customer base when doing their marketing. It takes more to capture a new customer than retaining customer, as seen where costs is higher in attracting new customers and lesser value earned. With the misalignment between customer and Groupon’s needs, Groupon has to look into the management of these customers to improve their value provided for

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