Google, looking to buy Groupon? I don't think so....

Groupon is a website service that specializes in offering its subscribers special deals.   Haven’t heard of it?  Then jump on the bandwagon!!  Groupon is a website that offers discounted rates for all types of activities within your city, it is able to do so, because it ensures to the business offering the special deal that the special deal will result in a greater majority of customers.  Simply put, it is similar to how a business lowers its price or offers special deals when selling in bulk, or when a service is being sold to a big group.  In this case the group is much bigger and therefore the price can be lowered drastically.   The more people subscribe through Groupon and the more the company expands the greater the number of deals and the better their price.  Currently Groupon is the absolute leader in this industry, though many other companies have copied it, none are a direct threat.  The only that comes close is LivingSocial.  Living Social though has much catching up to do.  Considering that this year Groupon reached over 150 million $ in sales while LivingSocial only reached 49 million, it seems unlikely at this stage that LivingSocial will ever catch up, especially considering that this business grows exponentially.  In fact Groupon is only 2 years old.  In such short time its growth is truly astounding; currently it is valued at over 1.5 billion $.  LivingSocial’s growth is also astounding, yet not enough.  Nonetheless though LivingSocial might never be able to compete with Groupon it is likely that it will never be driven out of the market.  Aside from LivingSocial, there are many other imitations of Groupon, yet Groupon is not threatened by any of these.  Actually its competitors have favored its growth.  How? Simple, imitations of Groupon began in Chicago in 2008, start up in their local cities, doing all the work, all the networking and research and then Groupon comes in, without having to go through the trouble of organizing anything and simply buying off these small companies.  Impressive right?!

So what is the buzz on Groupon?  Well rumor has it that Google is interested in buying Groupon.  Could this be?  Well sure it can, Google’s growth is truly intimidating, in fact recently this has lead to a certain degree of scrutiny, where Google is being accused of breaking Antitrust laws.  The question therefore is:  Will Google buy up Groupon?  And what will result from this?  One thing is for sure.  Google is certainly capable of purchasing Groupon, as well as LivingSocial and any other possible competitor.  Yet how will this further expansion favor Google’s already tainted image as a growing monopoly?

 If Google buys Groupon then LivingSocial will not stand much of a chance, considering that Groupon’s capital would increase drastically overnight.  Yet it might not be in Google’s best interest to purchase Groupon, nor to run LivingSocial out of business because this will of course give greater weight to the accusations that Google is on its way to becoming a monopoly.  As well there is the question as to whether or not Andrew Mason, Groupon CEO, is willing to sell.  Considering the company’s fast growth, and the fact that Google has attempted to develop similar ideas and has failed, it might not be in the Mason’s best interest to sell.  Who know’s maybe in another 2 years it will be Groupon that will be buying off Google.  Please comment; your opinion is much appreciated. 

Best, Gian Marco