It has been on every newspaper and it is now the topic of many opinion programs on the radio and TV. It is the possible acquisition of GroupOn by the internet giant Google. The speculation about the $5 to $6 billion dollars deal, that would make Google control the group discounts site, has provoked strong effects on the e-business environment.
One of these possible effects is the business move that other giant, such as Amazon.com, has made today after acquiring LivingSocial, the main competitor of GroupOn. The deal reached $175 million and it materializes the most important competitor that Google will face if it takes on GroupOn.
LivingSocial, as a Social Commerce e-business, aims to offer group discounts. Basically, it offers a “deeply discounted” deal of the day at local businesses which may be purchased for a voucher to be used in the business location. This voucher may be shared with at least three people to purchase the service, in which case will be free.
According to some measures, such as the Market Share of visits, LivingSocial is already the closest competitor to GroupOn. The graph below elaborated by Hitwise shows the numbers and tendencies for each company.
The acquisition of LivingSocial and the possible deal between Google and GroupOn seems to open a new era for Social Commerce and it could set a trend in this kind of acquisitions. It will also be really interesting to see the advantages that these will report to their buyers.
The interest of these huge e-business enterprises such as Amazon and Google on these Social Commerce sites only highlights their success on what is already an important and innovative way to do business. It will be really interesting to see what happens after these types of companies take on Social Commerce.
Anibal:
ResponderEliminarI just don't see what's so hot about it! Ok, they are making money... but for how long?
This business model is very vulnerable to competition. (It's not very hard to tell how is it they are making the big bucks.... and as you can imagine, many lookalikes will follow... and they will start cannibalizing each other (in my opinion, till they completely destroy the market).
I do however wish they were not wrong to pass on Google's offer (if there was an offer to begin with).
Well, Groupon will continue growing alone for now. Yesterday, it rejected the offer from Google…only $6 billion! However, I think it’s better that way for the deal-of-the-day company. When a giant company as Google or Amazon wants you, it means you are doing things well. Why would you consider giving the product of your hard work to anyone else? because of 6 billion dollars…right, but beside of that, you could continue growing and producing more. Check this article on the Chicago Breaking Business for the details. Also, you can visit My Blog for more information about Groupon.
ResponderEliminar