Groupon CEO: We’re Not Trying To Become Amazon
Groupon Goods, Groupon’s online retailer offshoot, represents a successful endeavor. It accounts for 11.4 percent of the company’s North American revenue, and will total just shy of $195 million this year.
It follows, then, that Groupon would have interest in transitioning further into the world of online retail and eCommerce. Right?
Wrong. At least if you believe what Andrew Mason, Groupon’s chief executive officer, said during his company’s quarterly conference call last week.
“We built something that fits squarely into our core customer value proposition of the discovery of curated offers and carves out a unique space in the retail e-commerce sandbox,” Mason explained. “We neither need to nor do we want to try to out-Amazon Amazon. We’ll never be about comprehensive product selection, but our skills at curating unbeatable offers are clearly resonating with our customers.”
Groupon Goods serves up a few offers daily, offers free shipping and returns on any purchase over $15 and is even opening up special “holiday stores,” according to Tech Crunch.
If you think that sounds more than a little like some of the features Amazon offers, you’d be correct. Plus, the odds are decent that Groupon is scrambling for some way to make up the massive losses its experienced in the stock market as of late. And last week’s Q3 results didn’t help.
Groupon’s shares fell nearly 30 percent the day after it’s quarterly earnings report, which missed analyst estimates despite a 32 percent jump in quarterly revenue. The company’s share price currently sits $2.64 and its market capitalization is just $1.72 billion: probably not what Google had in mind when it offered to by the company for $6 billion in 2011. Overall, Groupon has lost 80 percent of its value since its ill-fated IPO.
But Mason remains positive: "Goods has been the primary driver of our growth over the last two quarters and is now at an annual billings run rate of nearly $1.5 billion. This begs the question, what does this mean for our local business? Has it reached the limit? To be clear, we continue to believe in the size of the local e-commerce opportunity in front of us.”
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