Forbes  Sep 29  Comment 
Groupon recently announced a bold restructuring move to lay off 1,100 employees and to exit 7 international markets. This latest move comes on the top of a series of measures that were recently taken by the management to re-invent the company...
SeekingAlpha  Sep 26  Comment 
Wall Street Journal  Sep 23  Comment 
With uncertain growth prospects, Groupon’s slashed market value still doesn’t present a bargain.
Benzinga  Sep 23  Comment 
Shares of Groupon Inc (NASDAQ: GRPN) fell more than 2 percent on Tuesday after the company announced it will restructure its international operations. Tom Forte of Brean Capital reiterated a Buy rating and $8 price target on Groupon following...
Motley Fool  Sep 23  Comment 
The group-buying site operator is scaling back its operations, and that's not a bad thing.
TheStreet.com  Sep 23  Comment 
NEW YORK (TheStreet) -- Shares of Groupon , the Chicago-based daily deals site, closed at $4.08 Tuesday, a drop of 2.2%.The company said it would cut about 1,100 jobs worldwide and exit several international markets as it pursues a restructuring...
CNNMoney.com  Sep 22  Comment 
Groupon will cut 1,100 jobs, or 10% of its staff, over the next year. The company will also close several international offices.
Wall Street Journal  Sep 22  Comment 
TechCrunch  Sep 22  Comment 
 Some significant downsizing is underway at Groupon, the daily deals and local-commerce site. The company is today announcing that it will be cutting 1,100 jobs — mostly in its sales (aka “deal factory”) and customer service operations —...


Groupon (NASDAQ:GRPN) is a group buying site which allows merchants to sell deals or discounted offers on their goods or services. The merchant can require that a minimum number of customers must purchase the deal before it becomes valid, or the merchant may limit the number of deals that can be sold. Individuals can subscribe to Groupon, and they receive targeted deals based on their location. Groupon makes money by charging customers for each offer, but the company pays merchants a negotiated percentage of each sale.[1]

Business Overview

For the full year 2010, Groupon's total revenue was $312.9M. This was substantial increase over the total revenue of $14.5M in 2009. The company had not achieved a net income however, as of 2010. In 2009, its net loss was $1.3M and in 2010 it was $413.4M. The largest cost the company incurred in 2010 was marketing, which was $290.6M in 2010. [2] This $20 IPO placed the value of the company at $12.7B.[3]

New Updates

The company's initial public offering of stock on the NASDAQ occurred on November 3, 2011. The company offered 35M shares each for $20. This was above the $16-$18 price range. The company sold 35M shares. This deal raised $7B. The lead bookrunners of the deal were Morgan Stanley, Goldman, and Credit Suisse.[4]

Trends & Forces

High Marketing Expense

Groupon's marketing in 2010 was nearly as large as its total revenue. The company uses marketing to encourage individual to subscribe to Groupon and to purchase live offers. Groupon believes that while it has faced a high marketing costs, such costs will be lower in the future as the company will have created a customer base. However, if such costs remain elevated, Groupon's profits will be directly lowered.[5]

Highly Competitive Industry

While Groupon is a large player in the daily-deal market, the market is very competitive. Groupon does not have any significant way to differentiate itself aside from the type of offers and the level of the discount. This means that defending its market share is relatively hard.[6]

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