It came as quite the shock when Groupon turned down the reported $6 billion deal with Google. From an outsider’s perspective, this seemed like the deal of a lifetime – one that would be prosperous and beneficial for both parties involved. However, refusing this acquisition may be a small step in a big direction for Groupon.
Dominating the space as the largest group buying service, Groupon feels little threat from their competition. Having the ability to gain continued business relationships and increase users, they continue to grow while others fight for similar space.
With Groupon turning down the offer from Google, this leaves both companies fighting neck and neck in online marketing. Groupon already taking advantage of its business partnerships and growth through local deals, they continue to expand through this new form of online-to-offline advertising that Google shows strong interest in.
As Groupon continues to generate its local deals and build continued partnerships with retailers, they can also expand their inventory of deals through their recently launched 2.0 version – allowing businesses to create their own self-serve deals. The future of Groupon resides in their continued success of generating new and unique local deals, something that doesn’t seem too far-fetched for Groupon.
Without an investment in Groupon and its success, Google is left to create and introduce its own deals services if it wants to become a heavy hitter in online marketing. Although local could be a huge growth area for Google, their ability to create this successfully raises concern. Initially it seems they have what it takes to create a similar service, and they may even be able to do this at a much smaller price than their previous offer to Groupon – but they risk the chance of not executing it successfully.
While Google continues to weigh its options for developing a local deals service towards online marketing, Groupon continues to succeed. In this market with virtually no competition, Groupon shows no motion to ease up – leaving a future full of possibilities for them, and a future full of obstacles for everyone else.