After failing to win over Groupon with a $6 billion bid, Google is courting the social buying site’s rivals. Google is in talks with much smaller rivals of the two-year-old firm. In two years, Groupon, based in Chicago, has ballooned to 3,100 employees, 35 million users in 300 markets and more than $1 billion in annual revenue. In comparison, LivingSocial, the No. 2 player, has about 10 million subscribers in more than 120 markets. Although LivingSocial, which also generates significant cash, may be an attractive alternative for Google, a takeover deal would not come cheap or easy. LivingSocial raised $183 million this month from Amazon and LightSpeed Ventures, in a deal that valued the company at more than $1 billion. At the time, the company reiterated its commitment to flying solo.
Beyond LivingSocial, there are a couple of notable players in the market.
BuyWithMe, based in New York, operates in 12 cities. The company’s interim president, David Wolfe, declined to comment on possible talks but said, “Google needs to enter the coupon advertising market.” The company has raised over $20 million since it was founded in 2009.
Tippr, owned by software company Kashless, operates in 25 markets. Like Groupon, the company has recently expanded through acquisitions, buying FanForce and Chitown Deals in June.
According to analysts, Google was eager to acquire Groupon, which offers deeply discounted offers from vendors, to gain a stronghold in the fast-growing local advertising market. By connecting consumers to merchants in their hometowns, social buying sites have created a valuable way to tap into small and medium-size businesses. Local online advertising is expected to grow 18 percent, to $16.1 billion, next year, according to the advertising research firm Borrell Associates.
Read the previous story on Google-Groupon Deal @ Deal Market
No comments:
Post a Comment