By: Arthur Cooper
Submitted: 2010-12-27 21:12:02 | Word Count: 664
After the popular coupon sharing site Groupon rejected a $5 to $6 billion offer from Google, the search engine giant may be looking to acquire the company’s smaller rivals.
Groupon has seen wild success recently, and Google is eager to get in on it – and rightfully so. In the slumping economy, people are much more financially conscious, so the website’s introduction was a simple matter of the right place at the right time.
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Here’s how it works, the site offers one discount per day, per area. If enough people sign up for the coupon, everyone gets it. If not, no one does. It promotes sharing of their site, as people will bug their friends to sign up if there’s something they really don’t want to pay full price for. And, it’s a fairly safe way for businesses to advertise. It gets their name out there without too much of a financial commitment.
The site was projected to make over $500 million in 2010, with exponential growth predicted in the future. So, it’s pretty clear why Google wants in on the action.
One big name, next to Groupon that is, that Google may or may not be looking at is LivingSocial. However, they have seen some successes on their own and may not be interested in a Google bid. LivingSocial just made a $175 million deal with Amazon.com, which may keep them out of reach for Google.
I don’t necessarily agree with some tech-savvy writers that say Google needs to get in on the coupon sharing market; however, it certainly wouldn’t hurt. Google seems to have their hand in all kinds of pots and if they can’t get in on this one it’s not going to be the end of Google as we know it. I also suspect that the coupon sharing market may be a flash in the pan kind of industry. Once the economy picks back up, people may not be as interested in spending time trying to get coupons and discounts. Although it seems to be growing faster than Facebook right now, I’m not sure it’ll be able to maintain that growth.
Groupon Hires New CFO
With all this financial talk, growth and giant companies going after Groupon, it’s no wonder that the 29-year-old founder of Groupon, Andrew Mason, hired an experienced CFO. Jason Child comes to Groupon from Amazon.com and brings with him over 10 years of corporate financial executive experience.
Child said in a press release that announced his move to Groupon, “Groupon is one of the most amazing businesses I have ever seen. I am thrilled to join a great team that is attacking one of the biggest opportunities in e-commerce today.”
For now anyway, with new leadership and opportunities abound, the sky is the limit for Groupon. But, Chicken Little may come knocking before too long. Time will tell if they end up like Facebook – and create a whole new internet industry that sticks – or if they go by the wayside like so many other e-commerce sites.
