Global Internet Catalog & Retail

Will the Death of Groupon Be its Lookalikes?

GrouponA corporate strategy article by Thunderbird students.

In 1887, Mr. Asa Candler was faced with a distribution dilemma. [1] The Atlanta druggist had spent $2,500 on a formula for a sweet-tasting drink and was looking for a way to promote the sale of this little-known beverage named Coca-Cola. [2] His solution: handwritten tickets offering customers a free sample. To Mr. Candler’s surprise, the offer was a huge success. So was born the coupon. By 1913, an estimated 11% or roughly 8.5 million Americans had received a free coke. [1] One could argue that Mr. Candler’s invention of the coupon is the reason Coca-Cola started on its path to becoming one of the most iconic global brands - ever.

Fast forward to 2008, when an internet start up based in Chicago, IL created one of the largest shake ups in the marketing world since Mr. Candler’s first hand written ticket; that company - Groupon. The novelty of Groupon was this: through the power of the internet, select “daily deal” coupons could be offered and if a big enough “group” agreed to purchase the deal, then the deal would become valid. [3] The program was used by participating companies as a way to reduce the risk of losses, increase customer traffic, and drive promotions. Now four years since its launch, the Groupon business model has come under attack and faces many strategic obstacles, including competition from lookalike websites.

Reentering Asian Markets, eBay Rolls with New Strategy

ebay in ChinaA corporate strategy article by Thunderbird students Bo Lin, Jason Martin, Chiemi Perry, Jian Tong and Wei Wang

There are many characters to distinguish great companies with others, such as innovation ideas, stunning development speed and outstanding leadership.  However, not all great companies could rebound after their failure in some specific areas.  As we all know, the case of Starbucks in Australia and Wal-Mart in Korea, both reveal the insurmountable local market differences and accordingly systematic slow responses could lead many business legends to be negative examples.  To compare and research how to practice in this situation, we pick up the case from eBay and discuss how the strategy adjustments could help eBay come from behind to win.

eBay has a vision “to be the world’s personal trading community.”[i] Nevertheless, it struggled with early strategic moves in Asia, Japan and China in particular, and needed to reconsider its global strategy.  In general, eBay sought global growth through acquisition and joint venture as way to gain quick access to markets and establish a leadership position.  Since 1998 eBay has made 37 significant acquisitions globally, 25 of which amounted to $10.1 billion[ii]&[iii].  In Asia, three acquisitions of leading online marketplaces in South Korea, China, and India totaled $1.5 billion.  eBay sites also exists in other Asian countries such as Taiwan and Thailand.  Approximately 54% of eBay’s 2010 net revenue comes from international locations[iv], but revenues derived from Asian markets appear to be still much smaller.

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