Groupon: Still underwhelming


By: Kelsey Pavesich,0,302142.story

Groupon launched November 1, 2008 by Andrew Mason. This company merged businesses with customers. Groupon used the concept of collective buying in order to bring businesses and customers together in a beneficial way for both sides; sellers get a large number of new customers while buyers get great deals. When Groupon launched the social impact was huge. This ecommerce impacted people’s lives by offering them great deals on anything from dinner to sky diving. Groupon stands at the fastest growing company ever created.

Now look at today. Groupon has proved underwhelming since its fast success. Stock is currently at an all time low. This has forced Andrew Mason to look at the way they do business and make some changes. Groupon laid off 80 workers this week in order to optimize their sale force. They are moving more towards a technological route that will make deals more accessible to customers. Several months ago it was announced that productivity would be increased through automation technology. The company released in a statement that they “will always aim to optimize business operations wherever opportunities are identified.” This automation is an internal tool that is beneficial to the consumer and Groupon’s merchants; it allows personalized deals for customers and can be used to predict different leads in the merchant database. Mason has said that in the last several months’ sales force productivity has improved which increased the number of deals a customer can buy. This is due to the new tools Groupon has released. Mason is quoted: “Those sorts of things are allowing us to increase productivity and continue to scale without adding the same headcount as we have in the past.”

This technology boost in Groupon shows that they are emphasizing agility and focus on the future as their main core values. Agility focuses on faster, more flexible, customized services as well as shorter cycle time for new and improved services. Groupon is trying to obtain a higher level of agility in their company by using automation technology. This allows for a single customer to access their personalized deals faster as well as improve services with merchants. A customer can now view more deals tailored to their preferences at a given time.

Groupon has received some public disappointment with their current state compared to where people thought they would go. This shows how Groupon needs to focus on the future. It has been hard for them to maintain sustainable growth after their initial launch. Their stock is currently at an all time low so they are not leaders in the market. Focus on the future might not have been one of Groupon’s main core values in the past but it needs to be at the moment if they want to compete in ecommerce.

In your opinion is this move towards automation a good idea for Groupon even though they are laying off workers?

What do you think the main core values are of Groupon?

What core values do you think Groupon needs to focus more energy on?

4 thoughts on “Groupon: Still underwhelming

  1. The idea of automation from a business perspective is good, in terms of saving cost and improve efficiency with personalizing customer deals. From an employment point of view, laying off 80 workers, plus more to come since most operations are being done though automation. It seems like Groupon core value right now is to optimize profit at any means. Groupon should focus on maximizing profit without layoffs by doing online deals as they have been including the addition of automation. Groupon should also have their sales associates physically go out to the market and sign people up for deals who don’t have access to computers or for those who are not computer savvy. Consumers would love the ease of buying Groupon deals without dealing with online purchasing. This method should help Groupon make up for sales they are lacking online and keep from laying off workers.

  2. The automated idea for any business is always sought out especially when trying to save money, make a greater profit, and make its product more customizable to its market. While at the expense of moving towards automation is 80 employees one can hope that it really is worth it. It’s understandable a company needs to cut off expenses and if those 80 employees are not needed well then it had to be done. As for the main core values of Groupon, they are maximize profit no matter what at all expenses and to be more customizable to its customer base. The core value Groupon needs to focus on a great deal is maximizing profits at any expense. Yes it’s is good that they care about the profits that they are making but they don’t realize that massive layoffs like that build a reputation on the company. Soon enough people will not want to apply there because of the same reason that they know in the future they risk getting laid off.

  3. I think that Groupon’s overall focus and attention should be based on customer needs/values. They have expanded very quickly over the past few years and I think that their strategy of expanding the company so fast and in so many different directions may have resulted in the company’s employee layoffs and drop in the stock price. I found this article to be very interesting and informative and led me to do some other research into the history of Groupon and the types of deals that the company offers on a daily basis.

  4. That’s definitely a difficult question to answer but it seems like Groupon is trying to adapt for survival with in an ever so changing e-commerce environment. It will be interesting to see how their new aspects of automated operations will effect them negatively or positively.

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