For the last several years, Groupon has been expanding its business beyond the daily deal to position itself as the platform for local commerce. Some of those efforts have proven to be more challenging than others, however. And so, as Groupon now downsizes in less profitable areas, it’s also making a return to products that are tried, tested and lucrative.
Groupon says that it’s worked with more than 1 million merchants to date, and in a bid to grow their business with them even more, today Groupon is announcing a revamped and expanded Merchant platform, including a new tablet app for businesses to build and manage daily deals.
The news comes at a time when Groupon has been shuttering parts of its international operations and reducing its workforce across the board as the company carries out a more focused approach to its business under new CEO Rich Williams. “We need to win where winning is material,” he told TechCrunch last month, which includes making “the hard call to allow the team to focus on what really matters.”
Most recently, the company confirmed layoffs of 25 people, or one-third of the staff, at Breadcrumb, its restaurant software business. Groupon has been rumored to be preparing to sunset the Breadcrumb business, although the company has denied that this is the case.
On a more optimistic front, Groupon beat analyst estimates for the last quarter both on revenues and earnings, and is now training its sights on the stronger parts of its business, 85 percent of which comes from 10 markets and the categories of food, beauty and events.
Most customers purchase the Groupon coupons on mobile, and Groupon is continuing to make sure that mobile remains a strong platform on the supplier/merchant side of the equation, too.
“We’ve seen first hand that local businesses can compete in an increasingly connected world and against online giants, and we’re focused on continuing to enable that competition,” said Aaron Cooper, SVP of North America Services, Groupon, in a statement. “There is no one-size-fits-all approach to bringing in new customers, which is why we’re giving merchants every option they need to run a promotion with us in a way that’s the most advantageous for their business.”
Here’s a rundown of the new features:
- Mobile and web tools are all getting put under a single brand, Groupon Merchant, and merchants can search for services based not on the feature but their own category of business.
- A new Groupon Merchant tablet app (Android and iOS) lets merchants track campaigns across web and mobile, and also lets them incorporate their tablets further into the point of sale process, using the app to redeem Groupon offers as well as track campaigns, and market them on social media, as well as use the app to respond to customer service messages.
- Groupon is also adding more features to build deals in a faster and more customized way — which to me seems like an essential tool to help businesses appear more distinctive and unique on the Groupon platform, whose interface tends to downplay individual companies’ brands in favor of an overall Groupon branding.
When you think about it, building Groupon’s business out from a core of daily deals is smart. It’s the first and often only touchpoint that many of its customers already have with the e-commerce company, so it’s a natural startup point for upselling to other services around them, like managing and marketing those daily deals.
Another reason Groupon might be able to see more expansion in this area is because of the size of retailer that it targets: The company says that more than 90 percent of Groupon merchants have 20 or fewer employees, with one-third sole traders.
This effectively means that Groupon’s customer base is full of people who don’t have the resources or interest to hire external IT or marketing staff to handle things like building deals online or social media management. That leaves an opening for a company like Groupon to upsell retailers with a range of DIY merchant services to help grow their businesses — and Groupon’s too.