Groupon Struggles, Why? | Jeff Kagan Tech Analyst

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Jeff Kagan

Tech Analyst

     

When Groupon went public it was such an event. Everyone was smiling from ear to ear. They saw this thing continuing to explode with growth.

However growth has just not occurred. Why?

When they were going public I saw a brand new idea, but not a long term success story. Their long term success would come from their ability to reinvent themselves, time and time again.

Now CEO Andrew Mason says he has to instill a different type of behavior in his customers. The Wall Street Journal says that probably means they aren’t buying.

I agree. So what’s the answer?

Groupon plans new and innovative ideas in hopes it will reignite their success.

One plan is to make Groupon deals available on wireless phones.

Whatever path they choose going forward, the fact is that the current wave which Groupon was launched is quickly fading.

They need another successful wave to ride or they are in trouble.

I like their spunk. Their desire to make lightning strike twice.

However that doesn’t match well with the investment world does it? They look for a more continual increase of wave after wave.

The sad fact is the companies business is slowing. Can they create the next wave to ride?

Don’t know. However they had better be able to because they are in an industry with rapid ups and downs and apparently they and their investors were surprised by that fact.

I have written about this several times. Here is one sample where I said the following in my column on eCommerceTimes.com http://www.ecommercetimes.com/rsstory/73977.html Deal sites like GroupOn and LivingSocial have become overnight successes. Are they a flash in the pan, or will they have a long life?

Poor performance was what my fear was when they went public and unfortunately that is what is happening. They can recover. The question is will they? Hope so.

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Please attribute to Jeff Kagan, Tech Analyst with www.jeffKAGAN.com

If you would like to discuss, call me at 770-579-5810 or send an email to jeff@JeffKAGAN.com

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Jeff KAGAN| Tech Analyst www.jeffKAGAN.com

Analyst sharing perspective on the changing industry for 25 years

~ Also Columnist, Author, Consultant, Speaker
~ Column http://www.ectnews.com/perl/section/jeff_kagan/

Phone 770-579-5810 Email jeff@jeffKAGAN.com

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