Billions Of Local Queries At Stake In Google’s Groupon Offer

Groupon is a new, but respected community business giant. Google has made an offer for Groupon. The offer values the company at over $ 5 billion. This is a strategic move for Google. Small and medium businesses are expected to move away from search marketing, and this might help Google give them another option.

Community Groupon starting out

Started in Chicago, community enterprise marketer Groupon has been expanding exponentially within the last 2 years. You will find 2,500 individuals hired by the company around the globe. Yearly, it makes half a billion in revenue. Every single day, a discounted offer gets sent to e-mailed subscribers. That is the way the enterprise works. Usually, small and medium local companies use Groupon to bring customers in with their deals. Groupon obsessively tracks the buying habits and demographic data of its subscribers to offer them deals they’re more likely to purchase.

Google having issues with local search

Small and medium community enterprises are hard to get to by Google even though it’s a leader in web search. Paid local internet search on Google is expected to drop by 20 percent or more over the next five years. Small companies tend to use and then drop Google advertising and sponsored search results. Local businesses only make up 18 percent of Google’s ad revenue. The Facebook Places launch has Facebook competing with Google for community businesses. Google is also facing anti-trust investigations in Europe over how search engine results are ranked, which could seriously impact search revenue, if the company is found at fault.

How the Groupon / Google deal will continue to work

Both businesses might benefit if Google’s $5.3 billion offer goes through to Groupon. It seems like Groupon hasn’t been around for very long. The small investment might get it a huge return. Google might be given access to a huge trove of consumer data – every little thing from consumer e-mails to pricing info and spending habits. Google would likely use the opportunity to continue its expansion beyond simple search and paid search revenue. There is no surprise within the deal happening. Google, in 2009, wanted to buy Yelp. The change in buying options would be what happens if the Google-Groupon deal really happens which creates a difference.

Citations

All Things Digital

kara.allthingsd.com/20101129/googles-groupon-offer-5-3-billion-with-700-million-earnout/

Adage

adage.com/digital/article?article_id=147349