Groupon – which offers a daily deal – has become a global phenomenon, and reportedly turned down an offer of $6bn to sell to Google. Sites such as Groupon work by sourcing a single deal at a large discount which is only available if a sufficiently large number of people in any given location sign up for it.
The two-year-old company is profitable, popular and on to a winning formula that can be executed on a large scale. Groupon proved the latter in August through its first national deal, with Gap to sell $50 worth of apparel and accessories for $25. While previously, the site was known for local daily deals with small businesses, the Gap program was a huge success.
In one day, the company sold 441,000 Groupons, netting about $11 million. At the moment, Groupon is the biggest player in this emerging space by far, but the interest from Google will no doubt spur deep-pocketed competitors to file in.
And of course there are other serious players in the group consumption phenomenon.
Jumponit.com.au offers fitness, beauty, dining and adventure deals.
Cudo.com.au is fast taking market share in Australia with a strong marketing campaign. Offering deals from kayak lessons to beauty treatments.
Allthedeals.com.au is the Google of Group buying. It puts daily and weekly specials into one cenral location. Users can click through offers from all the main players, as well as the latest catalogues from Kmart, Target, Optus etc.
Scoopon.com is probably the most contentious of the collective consumer gang at the moment. Set up by two Australian brothers brothers Gabby and Hezi Leibovitch, who were also the makers of Catch of the Day. Scoopon has in fact been causing Giant Groupon's delay into the Australian market.
In a media posting Groupon CEO Andrew Mason said: “The worldwide proliferation of Groupon clones has been well documented. One particular clone in Australia called Scoopon, created by the brothers Gabby and Hezi Leibovitch, has been making life difficult for us. Scoopon went a little further than just starting their Groupon clone – they actually purchased the Groupon.com.au domain name, took the company name Groupon Pty Limited, and tried to register the Groupon trademark (filing for the trademark just seven days before us) in Australia.”
Mason added: “As Groupon became internationally known, opportunistic domain squatters around the world started to buy local Groupon domain names, thinking that we’d eventually be forced to buy them at an insane price. In fact, we tried to do just that, reluctantly offering Gabby and Hezi Leibovich about $286,000 for the Groupon.com.au domain and trademark—an offer they accepted. But now they’ve changed their minds, and we believe that they’ll only sell us the domain and trademark if we’re willing to buy the entire Scoopon business from them.”
