Why the Daily Deal Appears To Be Dying

Groupon was once the fastest-growing company in the history of the web. Its stock reached a $28 initial public offering high mark in 2011, but now trades at about $4 per share. And despite diversifying its business, introducing Groupon Goods, for example, the company has seen its revenue steadily decline. It was down last quarter by about 4 percent from the year-ago period, at $673.6 million, a level that was well short of the $725 million analysts had expected. Meanwhile, similar coupon services in the U.S. and elsewhere have pulled the plug on daily deals. As observers ponder such developments as signaling a dying industry, Smith School marketing professor Lingling Zhang offers some insights. She says two factors have significantly hindered Groupon. Read more...

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