Good points and I agree that Groupon seems to get jumped on for unjustified reasons. I don't believe that they would have ever gotten so many customers if it was such a bad deal for businesses. 40% "failed experiment" rate in advertising is not bad. For them it's a one off cost. For the ones that do get value it's an ongoing advertising channel. Eventually most customers will be repeat customers.
What I don't see is how Groupon would hold on to a market like this. Where are the barriers? There's no reason n+1 Groupon sites couldn't exist. I also see no real need for Groupon to be big. If there is to be a leader in each market(city), why should Groupon be outcompeting local Tokyo, Paris or Tel Aviv Groupon clones? Groupon has its brand and experience and other little advantages, but nothing that outclasses whatever advantages the small competitors could plausibly bring to the table.
If someone told me this idea before Groupon, I'd think it was good, especially if they had demonstrated that businesses will bite, which Groupon has. It's a great idea for a business with value for businesses and customers. I really don't get the Groupon hate. I just don't see this as a winner take all market where a head start guarantees much. I don't think Warren Buffet would buy Groupon.
What I don't see is how Groupon would hold on to a market like this. Where are the barriers? There's no reason n+1 Groupon sites couldn't exist. I also see no real need for Groupon to be big. If there is to be a leader in each market(city), why should Groupon be outcompeting local Tokyo, Paris or Tel Aviv Groupon clones? Groupon has its brand and experience and other little advantages, but nothing that outclasses whatever advantages the small competitors could plausibly bring to the table.
If someone told me this idea before Groupon, I'd think it was good, especially if they had demonstrated that businesses will bite, which Groupon has. It's a great idea for a business with value for businesses and customers. I really don't get the Groupon hate. I just don't see this as a winner take all market where a head start guarantees much. I don't think Warren Buffet would buy Groupon.