Registered: Sep 2011
11-09-11 12:16 PM
Don't get me wrong, if I can make a buck day-trading it, I will. But there's no way I'd keep the one overnight.
I've researched Groupon extensively, there's plenty of information out there. Coupons are great, I agree with the previous poster.
However, Groupon has a flawed model, almost a ponzi scheme in a sense in that they take in money for coupons and hold that money, not even releasing it to the vendor when it's redeemed, but at a future point....basically whenever they choose to release the money. So, they are using those funds to float the business, always counting on additional money coming in.
Now, they have cash so won't have to do that so much...but they are so far from profitable that it's unclear how they'll ever get there. Especially now that Google, livingsocial and lots of other similar daily deal coupons have hit the market. Groupon doesn't have any kind of edge, this is a very easy to duplicate model, one that is vulnerable to undercutting on cost and easy for a local person to set up and run.
Not to mention that the Groupon is so deeply discounted that most merchants are not making money or gaining new customers, they're just getting the cheapskates who want a deal....example a $20 pizza for $10. That person will buy the pizza for $10 but probably won't be back for another at $20....that's what the research shows thus far.
It will be interesting to watch, and it's comical that Groupon aims to position itself as another Amazon, a company that continually expanded and delayed profits. However, Groupon is no Amazon, which is an innovator.
All said, am happy to make profitable day-trades on Groupon all day long!