Groupon CEO: 'We've cracked the code'

Summary:Despite uneven earnings reports before and after declaring an initial public offering last year, Groupon CEO Andrew Mason remains steadfast behind Groupon's current product and financial strategies.

Despite uneven earnings reports before and after declaring an initial public offering last year, Groupon CEO Andrew Mason remains steadfast behind Groupon's current product and financial strategies.

Mason discussed the state of the daily deal market where his Chicago-based corporation fits in while speaking on the final day of the 2012 Goldman Sachs Technology and Internet Conference.

"Groupon has gone from zero to where it is in three years. It's been called the fastest growing company ever," asserted Mason, reflecting that pace happened because of the "size of the opportunity laid before us".

"We've cracked the code on it," Mason said firmly.

While admitting that "we're still in the first inning" of the development of the daily and local deal commerce market, within a few years from now, Mason predicted that "people won't be able to imagine how they lived without it".

There's no denying that the daily deal market became flooded quickly within a few months, but it's starting to become more clear as to which (few) players will survive.

Mason acknowledged that there is "room for many winners", but cautioned to new businesses looking to make a buck in this field that "there are low barriers to entry".

"They're finding that scaling the business and having a degree of success is actually quite difficult," Mason remarked.

Taking a diplomatic approach, Mason said that, "at this point, when we think of the competitive landscape, we think that the biggest competitors are ourselves".

"The best way to think of Groupon is as a curated marketplace of unbeatable deals on great stuff," Mason said.

However, it's not a secret that Groupon has had a tumultuous time in the last year.

Mason admitted that the "most culturally disruptive period" was after filing the S-1 form with the US Securities and Exchange Commission in June, which Mason described as a "good learning experience" for the company.

"We toughened up during the quiet period, and we're now back to business as usual now that we're a public company," Mason added.

Mason recapped how Groupon has grown from a start-up that promoted just a single deal each day to growing to an enterprise promoting many deals per day in 47 countries — but with a bigger focus on local.

One example is Groupon's venture into instant deals, which Mason explained that instead of getting hit with an email and discovering something you might not buy, it starts from wondering if you're hungry or bored.

When asked about the difficulties of tackling the location-based product trend in tech, Mason posited that local is "a win-win" situation.

"For consumers, we're allowing them to experience more buying power," Mason posited. "For merchants, we're helping them do a better job with wasted inventory."

But understanding mobile could be even more vital to Groupon's success than just social and local interests.

"It doesn't really work if you want to sit down in front of a desktop every time you want to buy something from a local merchant," Mason asserted.

Along with mobile apps already available for free to consumers, Groupon is pushing its mobile platform to vendors by shipping mobile devices with pre-installed merchant applications, which can be used to track redemption as well as collect data about overspend.

Another program on this platform that is in pilot mode is Groupon Rewards, which issues rewards to repeat spenders based on credit card information.

"We think that the paper model of redemption will eventually go away," Mason predicted.

Via ZDNet US

Topics: E-Commerce

About

Rachel King is a staff writer for CBS Interactive based in San Francisco, covering business and enterprise technology for ZDNet, CNET and SmartPlanet. She has previously worked for The Business Insider, FastCompany.com, CNN's San Francisco bureau and the U.S. Department of State. Rachel has also written for MainStreet.com, Irish Americ... Full Bio

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