It’s a battle for the new business age. An interesting duel that has no doubt left Google with a bitter taste in its mouth after Groupon’s rumored rejection of the search monster’s $6 billion bid.
Take a second to think about what I just said – Just two years into existence, this rookie online local marketing phenom has built an empire that Google (which pretty much runs the world at this point) is willing to offer $6 billion to own. Which means that the nice people at Google probably think Groupon is worth even more than that – or at least to them it would be.
They may still publicly be going through negotiations, but we think the subtext sounds a lot more like this…
Groupon: Na na nana na! No deal!
Google: Well sh*t!!
If you’re like anyone I know, the first time you read Groupon’s business model you probably smacked your forehead and wondered why you hadn’t thought of it already. It’s so simple that it’s brilliant – in essence putting those old entertainment discount books online. And that’s why Groupon was never on anyone’s radar. It’s so simple and “was looked at as a low-margin, not-scalable model,” said Rich LeFurgy, founder of another Silicon Valley company, advisory firm Archer.
But what are the less obvious repercussions of Groupon to smaller businesses and today’s business model? Here’s a good article on Ad Age that talks about what Groupon’s model might be doing to your customers’ relationship to you.