Boston, MA 04/11/2014 (wallstreetpr) – The unexpected is quite common in today’s swiftly changing world of business. The fortunes of companies like Groupon Inc (NASDAQ:GRPN) can certainly change very swiftly indeed. Even Apple Inc. (NASDAQ:AAPL) came back from the brink of death only with the return of Steve Jobs and with infusion of money by Bill Gates.
Groupon Has No USP
For businesses to survive and prosper in the long run, they have to have some unique selling proposition either based on the quality or brand value of the products they sell or some unique intellectual property which keeps them ahead of competitors — think of Google Inc (NASDAQ:GOOG) or chip makers like Intel Corporation (NASDAQ:INTC) and Qualcomm, Inc. (NASDAQ:QCOM).
In the online and dot com space in particular, businesses can acquire multi-billion dollar valuations if they have got hundreds of millions of users — WhatsApp being a case in point. Facebook Inc (NASDAQ:FB) justifies its valuation because of its billion-plus user base and advertising revenue.
Amazon.com, Inc. (NASDAQ:AMZN) has caused massive disruption to the publishing industry and Apple with its iTunes has been a disruptive force in the music distribution business. And Netflix, Inc. (NASDAQ:NFLX) is changing the way movies and TV shows are distributed.
Groupon is doing nothing of the sort.
When The Big Boys Challenge
Groupon’s business model is easy to replicate and when the ‘big boys’ like Amazon or Facebook find it to be lucrative enough, they’ll likely offer coupons like Groupon does and be able to make Groupon irrelevant just as Four Square was once a very popular app that has now lost much of its attraction.
Groupon Finances
There’s nothing spectacular on this front either — revenue increased by 20% in 4Q2013 to reach $768.4 million, compared with $638.3 million in 4Q2012. Operating income in 4Q2013 reached $13.4 million which was much improved from an operating loss of $12.9 million in 4Q2012. It expects 1Q2014 revenues to come in between $710 million to $760 million.
New Initiatives
Groupon has launched a new ad campaign which is its first since it met a lot of criticism for its Super Bowl 2011 ad. This time, it has adopted a rather conservative slogan for its ad: “Check Groupon First.”
Groupon Inc (NASDAQ:GRPN) has spent $260 million to acquire Ticket Monster from LivingSocial.
Groupon now offers in-store coupons for more than 200 national retailers in more than 2,00,000 locations and includes household brands like Staples, Macy’s, Toys ‘R’ Us and JCPenney. These freebies include thousands of digital coupons, promo codes, sales and samples and giveaways from thousands of leading national brands.
To target the spring wedding season, Groupon Inc (NASDAQ:GRPN) has unveiled a new Wedding Shop where those planning to walk down the aisle can save over $10,000 in engagement rings and designer dresses.
