Forbes: Groupon is the fastest growing network of company history
In August 2010 of "Forbes" magazine cover story "in the history of the fastest growing companies" describes the astonishing Groupon Group buy site development process, the company by the Northwestern University music student Andrew Lu Meisen (Andrew Mason) was founded 7 months to achieve profitability in less than a year and a half as high as 1.35 billion valuation, has become the latest Internet industry, "a fortune overnight" successes.
The following article summary:
Groupon clearly reflect the characteristics of the network business: high sales, profits, and easy physical retailers will close connections with the network of consumers. The site daily and business cooperation, efforts to introduce a very substantial discount offer products or services, as long as the order of the goods or services to a number of users can enjoy the benefits.
On the business, because the addition to the high discount things, need to Groupon into - up 55 percentage often open, Groupon although sales can jump, it is difficult to break even. Nevertheless, the business value Groupon of publicity, Groupon often buy Google and Facebook on advertising to attract the eye, and vigorously promote its offer of discount merchandise, the site's 13 million users already can generate word of mouth marketing effects can not be ignored.
Star network with many different sectors, Groupon is a real business, the company has 85,000 square feet in Chicago (about 7900 square meters) of storage space, according to a report by Morgan Stanley, this year's revenue is expected to more than 500 million U.S. dollars. No other Internet company in such a short period of time to grow to this size - including eBay, Amazon, Yahoo, AOL and Google account. Formed only 17 months later, the company acquired the Russian sky digital (DST) and other investment company's 135 million U.S. dollars, according to the investment agreement, Groupon valuation up to 13.5 million. Only valuation faster 10 billion company is founded in 2005, the video site YouTube, but the latter is still at a loss state, Groupon has set up seven months in which to earnings.
Groupon has entered 88 U.S. cities and includes Turkey and 22 countries, including Chile. Its imitators have sprung up, trying to copy Groupon success.
Mason and the general impression in the Silicon Valley geeks (geek) different, his childhood love is not computers, but music since the age of 6, started learning the piano - as far as he himself said: "Until about 25 years old I think they will be a rock musician. "
Mason has created ThePoint.com, the site is a collection to help supporters of the various petitioners, the online platform, in 2007, on line, and rapidly with its customers to win a variety of strange petition the national media attention. Such attention, to help him get the 4.8 million venture capital fund, however, ThePoint.com popularity not enough to attract enough advertising, as site traffic and business associate is not difficult to achieve profitability.
But in the business process, Mason found that some activities on the site ThePoint gather a large number of consumers, thus enhancing its bargaining power. He began to create a daily blog to launch a discount product, the support of investors, Groupon born.
Groupon the first seven employees make hundreds of calls every day to find the willing cooperation of the business. Group buy because businesses often require a certain amount before they agree to offer concessions to those who, when Groupon many of the transactions can not meet this requirement, means that there is no income that day (now 98% of transactions to achieve the minimum number of Group buy those requirements). Groupon sales staff work mostly in Chicago, the basic salary income is touching, is responsible for product publicity writers income equivalent to entry-level reporters, about 35,000 U.S. dollars per year.
On small businesses for the co-operation with Groupon often not profitable, but the publicity amazing. A helicopter flying lessons with Groupon club together to provide original price of 69 U.S. dollars 225 U.S. dollars of course, quickly attracted 2,500 subscribers, far more than expected in the 200 club. These examples reflect Groupon quickly the validity of marketing models.
There are 35,000 companies trying to Groupon cooperation, in order to obtain the favor of the latter is not easy, merchants must have been a minor celebrity in the network, had to promise to provide far more than the normal range of promotional discounts.
Groupon model main question is: anyone can copy. There are currently only 200 in the United States to follow those up to 500 overseas, and China will have 100 or so light. Many sites almost completely copied Groupon design, a Russian Web site from the font to the color completely copied Groupon the page, another Chinese site simply use the www.groupon.com domain. In addition, the microblogging site Twitter and the online retail giant Amazon is likely to become a strong competitor Groupon.
Of course, as a forerunner, Groupon advantage can not be ignored, it has become synonymous with Group buy website. Mason has also continued to emerge to maintain competitive advantage, one approach is based on the user's shopping history and location where the provision of targeted benefits of goods and services. He also actively pursued the acquisition, in May Groupon acquired Citydeal - Berlin, a company with 600 employees in 80 European cities operated by Group buy website. Mason said, may also buy from overseas, but to understand the habits of local consumers is not easy.
As has been profitable, Groupon ability to maintain high-speed expansion. Mason estimates that urban areas in Chicago, a day can provide 20 kinds of preferential trade, which means every year up to 5,000 businesses and cooperation far beyond the current 250. Currently across the U.S., Groupon provide 100 kinds of every day goods or services, Mason estimated monthly increase of 50 species, in January next year to 100. He also plans to marketing personnel and the number of writers increased 80% and 100%.
Groupon will soon achieve sales of one billion U.S. dollars, in addition to investment companies and business development, mainly through mergers and acquisitions of enterprises, Groupon will be the fastest ever to reach this size.