Why Groupon No Longer Has The Edge In The Daily Deals Business

Ecommerce is one of the most lucrative investment options for businesses regardless of their sizes or location. Currently, it is almost impossible to think of a business that has opted to completely stay out of the internet, with even small retailers launching their online-based platforms to attract those that are always glued to the web, and especially, social media.

As such, there are always deals and promotions running in a bid to attracting new customers to the platforms. In addition to this, there are also platforms that are keen to feature promotional offers from different ecommerce companies. For instance, traders visiting platforms like Plusvouchercode.co.uk can easily access promo codes and coupons for large ecommerce sites like eBay (EBAY), Amazon (AMZN), and Sports Direct, among others.

This means that companies like Groupon (GRPN) which previously thrived on the success of the daily deals business can no longer claim to have an edge in the market. While the coupon codes offered for the top sites like Amazon and eBay may not result in massive purchase discounts, they do provide some level of competition that Groupon isn’t happy to sit with.

The company would have to keep offering more attractive deals in order to attract traffic to its platform. Groupon shares have failed to cross the $10 per share mark since February 2014 and are now trading at $3.70, which is 81.5% off its IPO price of $20 per share.

This clearly indicates how the company’s leadership in the daily deals market has been challenged since going public in 2011, and sadly, it can only get worse from here onwards. Groupon’s other business stream, Groupon Goods, is now probably its best chance of surviving the onslaught launched by other online retailers, large and small alike.

Social media is at the center of Groupon’s woes with nearly every online retailer now able to establish a connection with their customers via these platforms. Right now, whenever a company launches an e-commerce platform, the first thing they think about with regard to building an audience that can be converted into customers is social media.

While social media platforms like Facebook (FB), Twitter (TWTR) and Pinterest do offer users premium social media marketing packages, it is possible to reach a significant audience without spending a cent. In addition, the premium packages offered have proven to be value for money, which makes it easy for small retailers to gain access to customers without having to offer their products via daily deals platforms like Groupon.

The pressure to the company’s business is also added by the fact that large players like eBay and Amazon are now being featured in several coupon code platforms. These companies have already established an ecosystem that allows their customers to purchase and sell products on their platforms without major constraints, which means that the promo codes available on platforms like Plus Voucher Code UK can only serve as an added advantage.

Conclusion                                                                 

In summary, Groupon no longer has the advantage it had before going public five years ago. In fact, going public only scrutiny thereby spilling all the secrets of its business. This has led to the increase of competitors in the daily deals business with promo codes and coupon sites adding to the pressure.