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Groupon Essay

907 words - 4 pages

Groupon is a global leader of local commerce. The company offers its consumers thousands of discounted deals tailored to their individual needs. Groupon offers discounts on products ranging from electronics, food, miscellaneous services, luxury items, to even exquisite “Groupon Getaway” vacations. The organization has successfully dominated the market at capturing 53% market share with its well-known rival, Living Social trailing behind at an estimated 22% market share. Both companies have found strategic criteria that work well for them. One key strategic criteria that Groupon has been using is to adjust their model and offerings to meet the market and consumer demand. According to an ...view middle of the document...

“With Gnome hardware, Groupon is hoping to change its brand perception and improve customer retention.” 3
Living Social’s three winning strategic criteria are different from rival Groupon. Living Social focuses on hiring the right people, organizational core values, and similar to Groupon, continuously evolving their strategic approach. Living Social’s Chief Executive Tim O’Shaughnessy acknowledges that the people who work for Living Social drive the company’s success. “We make sure everybody understands that [values] and give very tangible examples about, this is why we believe this, and recognize people when they live those values.”4. Because the market is very easy to enter, Groupon and Living Social need to constantly evaluate their strategies. Groupon is currently in the process of restructuring parts of their strategy due to recent declines in their numbers. Groupon’s IPO has fallen from $20.00 to as low as $2.00.
Projection of Groupon re: proactive initiatives and reactive adjustments
Because Groupon has experienced a trend of decline over the past few years, it has had to make adjustments in its plan. Groupon “can no longer claim to be one of the fastest growing businesses ever, but Groupon can at least brag that it survived the short lived bubble for daily sites.”5 Groupon has had to make adjustments to its strategic plan due to planned and unplanned experiences. “Nationwide, Groupon’s cut of daily market has (also) dropped. It’s share in the top 30 metro markets fell to 48% in May from 52% in April while Living Social expanded its share t0 24% from 20% in the same period.”6.
Groupon has taken a proactive initiative by offering many deals each day via smartphone and offering tailored deals to local markets which the...

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