Virtue said last year was a year of ‘deal’. Indeed it was, with Groupon accountable for most of the buzz. It has experienced an exponential growth rate in 2 short years and was estimated to make $2 billion in revenue annually.
It also made the headline when Gap announced that it made $11 million worth of sales in a single day on Groupon. That news has shown the world what Groupon is capable of.
Groupon was again under the limelight when it rejected a mouth watering $6 billion buyout offer from Google, leaving the search giant with a missing piece in its advertising business.
However, Groupon’s business model is easily copied. There are about 200 Groupon clone sites currently operating in the U.S and another 500 operating overseas. China alone has 100 sites offering similar services.
Groupon has tackled the problem by acquiring clones that are dominant in their geographical area. It has recently acquired sites in Singapore and Taiwan and has hinted its interest in China. Ali Baba’s Ju Hua Suan is one the more popular group-buying sites in China. Despite starting just March last year, it was reported that the Chinese group-buying site made $30 million in revenue at the end of 2010. It’s unlikely for Groupon to acquire Ju Hua Suan from Ali Baba CEO’s Jack Ma. He doesn’t need the money and he knows Ju Hua Suan has enormous potential in China. That means game on for Groupon: Let the battle in China begin!
And finally here’s the story of Groupon in an infographic, created by MBA online.
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