

How Sustainable Is Groupon's Business Model? - darklighter3
http://knowledge.wharton.upenn.edu/article.cfm?articleid=2784

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aorshan
I feel that within the next year groupon's bubble will burst. I constantly
read about how companies are unhappy with their groupon deals and how they
will not use groupon again.

This article: [http://arstechnica.com/web/news/2010/09/even-businesses-
that...](http://arstechnica.com/web/news/2010/09/even-businesses-that-made-
money-with-groupon-hesitant-to-try-again.ars) talks about a study done on
companies that used groupon and it found that 42% wouldn't do a deal again.
That simply isn't sustainable as a form of business.

I have also read on numerous occasions that many of the companies that have
used groupon found that the people using the groupon deals were previous
customers. This defeats the main purpose of using groupon as a company and
will likely contribute to the (predicted and in now way absolute) downfall of
the company.

I also feel like companies like groupon will be helping to create a massive
tech bubble, similar to the one in the late 90's and I am worried that it will
burst from rampant over-investment in companies.

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ethnomusicolog
The opinion of various tech blogger on Groupon is too harsch.

Of course, lot of things around groupon business model are shady. Yet they
uncovered a massive business opportunity which was not possible before the
advent of the social web.

They found a gem. Nobody can tell for sure whether or not they will be able to
refine it correctly, but right now they are in pole position.

~~~
aorshan
I absolutely agree with that. I think what they did was simply brilliant. They
practically carved out an entire industry for themselves.

