Why Groupon May Hold Leverage over Amazon - Research Report on Groupon, Inc.
and Amazon.com Inc.
There are countless issues surrounding the online industry of sweet deals and
cheap thrills, but the competitor between Groupon and Amazon has sparked some
NEW YORK, January 23, 2013
NEW YORK, January 23, 2013 /PRNewswire/ --
Groupon, Inc. (NASDAQ: GRPN) [Full Research Report]^[^1^] added fuel to the
fire after it bought CommerceInterface, a provider of e-commerce management
solutions to companies including Amazon.com Inc. (NASDAQ: AMZN) [Free Research
Report]^[^2^]. The deal is partly an effort on Groupon's part to advance in
the competition and to closely bid against Amazon's online retail and coupon
CommerceInterface is vital to web-based companies by enabling its merchants to
optimize the aggregation of goods from multiple vendors on an e-commerce
platform. By purchasing CommerceInterface, Groupon is set to become the sole
beneficiary of the channel management technology that Amazon heavily relies
on. Amazon and other companies that are benefiting from the sales process
management technology are given until the first half of this year to transfer
to another provider.
Groupon's acquisition sums up their plan of expansion. The company has a good
chance at improving its business and becoming safe for investment, but there
remain several challenges ahead. Amazon, with its tremendous pipeline, has the
potential to become the heavyweight competitor Groupon fears. However, despite
Amazon's relatively young online coupon business after purchasing
LivingSocial, there seems to be no vindication for Groupon.
Groupon's Strategy and Opportunity
One of the reasons why Groupon purchased CommerceInterface could probably be
its market strategy. With the help of CommerceInterface, Groupon can reach
international segments. Thus, it gives them the opportunity to increase
revenues and expand to new markets. This may be good news for investors, but
the company's competitive advantage does not seem to be making an impression
on analysts and investors. There have been a lot of sentiments surrounding
Groupon, one of which is to oust its beleaguered chief.
Meanwhile, analysts and investors' bullish view toward Amazon will hardly
change as the company was recently upgraded to outperform. Amazon never showed
any sign of uncertainty or agitation and the company does not consider Groupon
as a threat. As for Groupon, the company must utilize its recent acquisition
of the coveted CommerceInterface, go back to basics and explore the market
just like a start-up business. Spending time to consider current and future
trends of the market and its economic place within its target markets may just
earn Groupon its much-awaited salvation.
^ ^ The Full Research Report on Groupon, Inc. - including full detailed
breakdown, analyst ratings and price targets - is available to download free
of charge at:
^[^2^] ^ The Full Research Report on Amazon.com Inc. - including full
detailed breakdown, analyst ratings and price targets - is available to
download free of charge at:
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