Groupon is once again expanding its portfolio of mobile payment services, putting it in closer competition with the likes of Square and PayPal’s here targeting local merchants: today it has released Groupon POS, which appears to be an iPad-specific version of its mobile payments service aimed at local merchants, working as a dashboard to make and track payments.
This is the latest development in Groupon’s payments strategy and helps fill out founder and now-ex-CEO Andrew Mason’s strategy of Groupon becoming the “operating system for local commerce.” It shows that while Mason is now gone, the direction that he envisioned for how the company would diversify beyond daily deals remains.
It is also a sign of how the company is continuing to push mobile services. Last week, in its Q1 earnings report, Groupon noted that it had 41.7 million active users (meaning those that have purchased a Groupon offer in the last 12 months). In North America, still the company’s largest single market, some 45% of transactions were completed on mobile devices, up from 30% a year ago. In Q1, the company said that more than 7 million people downloaded Groupon mobile apps worldwide.
The Groupon POS iPad app is the fourth of Groupon’s mobile payments services. Last year, Groupon took the plunge into mobile commerce with the purchase of Breadcrumb, a point-of-sale iPad app for restaurants to help manage customer orders and payments, as well as seating plans, employee timesheets and more.
Later it expanded that with payments for other businesses in its Groupon Merchants app for iPhone in September 2012 and then Android in January 2013. Both of these use a Square-like dongle to accept card payments via a mobile handset.
The Groupon POS app appears to be a simplified, more generalized version, of restaurant-focused Breadcrumb: “Groupon POS works for a wide variety of merchants from cafes and delis, to salons, spas, and florists,” the company writes in its app description in Apple’s App Store.
Like Breadcrumb, Groupon POS integrates with the dongle-based Groupon Payments offering in the merchant apps. Also like Breadcrumb, it can work alongside an “optional cash drawer and printer to automate and simplify your point of sale.” It’s not clear if Groupon plans to ship Groupon POS along with these extra devices as part of its promotion of the new app (it did this with Breadcrumb back in October 2012).
While Groupon is trying to match companies like Square on a product-for-product basis, it is looking to be competition-busting (and merchant-attractive) when it comes to transaction fees.
The fees that Groupon charges Groupon Merchants for Payments are 1.8% on Visa, MasterCard and Discover when swiped, 2.3% when keyed in, plus $0.15 for each transaction. American Express pricing is more complicated as it is “determined by American Express based on your industry category.” The rates range from 2.3%-3.5% (swiped) and $0.00 to $0.15 per transaction, says Groupon. For non-Groupon Merchants, the fees are higher: 2.2% when MasterCard, Visa and Discover are swiped, plus $0.15 per transaction. Square meanwhile has two options: a flat 2.75% fee per swipe, or $275 per month with no fees per swipe — with the latter aimed at higher-volume users, or those who like to gamble that they might be.
Like Breadcrumb, Groupon POS appears to be only available in the U.S. for now. We have reached out to Groupon for more details about Groupon POS.
Update: Groupon’s now pulled the app, an early verion that slipped out unexpectedly, and a spokesperson tells me that they are launching a permanent version tomorrow. We’ll update with a new post and new details then.
H/T Ouriel Ohayon