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back to article Groupon bungles figures, slides $65m into the red

Discount coupon hawker Groupon has revised its fourth quarter revenue-and-loss statement, heightening concerns about the quality of its financial reporting. The snafu takes the web upstart's revenues for the period down $14.3m to $492.2m and increases its losses to $65.4m from $42.7m, as the firm needed to set aside more money …

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  1. Wibble
    Windows

    Caveat emptor all ye snake oil purchasers

    What a surprise, the new company owners must be so pleased they've bought a company that's built upon worthless principles and could easily be copied. Call it a tax on fools with too much money, or is that greed?

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    1. mraak
      Reply Icon

      Re: Caveat emptor all ye snake oil purchasers

      Not greed, I'd say hype, which is sure to attract a lot of stupidity as well. Pinterest anyone?

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      1. Anonymous Coward
        Reply Icon
        Anonymous Coward

        Re: Caveat emptor all ye snake oil purchasers

        Didn't we go thru all this horseshit back in the late '90s with Pets.Com and the like?

        All social media sites shares: wait 2 weeks and then start selling short.

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    2. JDX Gold badge
      Reply Icon

      Re: Caveat emptor all ye snake oil purchasers

      Any company can easily be copied. And the principles aren't worthless - otherwise they wouldn't BE copied.

      Not really a fan of Groupon but they offer a more 'real' service than many web-based companies.

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      1. Blitterbug
        Reply Icon
        Meh

        Re: 'real service' ?

        Hmm... they're in the same category as Incredimail tbh - a corporate money funnel with marginal, if any, benefits to users. I've had clients who've tried them out only to have their home pages diverted to Groupon and an unending spam torrent of 'offers' in their inbox thereafter.

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    3. Anonymous Coward
      Reply Icon
      Anonymous Coward

      and I predicted this....

      Last year, am I glad I didn't buy into it!

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  2. Anonymous Coward
    Anonymous Coward

    So they rip off companies...

    ... And still make a whopping loss?

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  3. Anonymous Coward
    Anonymous Coward

    GroupOFF.

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  4. Anonymous Coward
    Anonymous Coward

    Massively dodgy.

    We've been approached by GroupOn representatives multiple times trying very, very hard to get us to offer our product (theatre tickets) on the site, and telling us that others in our industry are doing very well on it. They consistently fail to give examples, and having talked to my contemporaries, it seems other theatres have lost enormous amounts of money by being taken in by GroupOn.

    Basically the customer gets a cut price deal, GroupOn takes a cut, and the client ends up selling their product at a massive loss. Where exactly is the incentive? No GroupOn rep has been able to satisfactorily explain that to us.

    Anon, because.

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    1. Lee Dowling Silver badge
      Reply Icon

      Re: Massively dodgy.

      Yep. If you're giving a 50% discount voucher yourself, that's one thing. If you're giving it to someone who intends to profit from it's "sale" to their users, that's another entirely.

      They may have larger marketing to attract customers but to do so at a loss seems ridiculous. The coupon *itself* is the marketing and if you wanted exposure, you could have paid for a full-page ad in a paper to distribute it. I'm sure that would be a lot cheaper than, say, giving a 60% discount voucher (in effect) to Groupon and it's "millions" of customers.

      I've mentally blacklisted any company that does business with GroupOn without thinking first - it's just a stupid way to run a business. From cupcake shops that get flooded with thousands of orders that they could never fulfill, to hairdressers who are "forced" to give thousands of haircuts at a loss, I've yet to see a good success story for anyone other than the customer - or a company that's got a head on it's shoulders touching the site with a bargepole.

      But, to be honest, I don't get why companies contract out positions to other companies that then do *EXACTLY* what the original company would have had to do AND make a profit on it, and that's quite a burgeoning business area too. Maybe I'm just thick.

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      1. Anonymous Coward
        Reply Icon
        Anonymous Coward

        Re: Massively dodgy.

        The company i work for uses Groupon for new product launches. It's proving to be a very cost effective way to boost product awareness and drive initial sales volumes - albeit at a lower margin to what we'd like but that is offset by increased demand that follows after the Groupon "deal".

        Providing that you ensure that you have read the extensive contract and are happy with the terms the site is a useful for moving products. Anyone selling at a loss needs to think twice about doing it. I do agree that Groupon can be very pushy to get you to run a deal with them but if it doesn't work in your favour or the numbers don't make sense you need to walk away.

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      2. Andrew Moore
        Reply Icon

        Re: Massively dodgy.

        I make a note of any restaurant that pop-up on Groupon, it's usually a sign that the eatery is on its last legs and should be avoided at all costs.

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    2. Wibble
      Reply Icon
      Childcatcher

      Re: Massively dodgy^H^H^H fickle

      The types of customers that Groupon would likely bring would be mercenary bargain hunters with absolutely no loyalty. Unless you've huge surpluses, or something to sell with massive margins, or some form of loss leader (e.g. hotel stay where profits are made in the bar/restaurant), flogging something for a massive discount is doomed I tell ye, doomed.

      The Groupon customers won't be back, nor will they be saying nice things except for the massive bargain they've just had, e.g. by implication how your normal prices are a rip off.

      Doomed. I tell ye.

      1 0
  5. Danny 14
    WTF?

    jebus

    who bought shares in this car crash? $26 a share for a "potential" 15m profit? Wha? This is the sort of price glaxo smith kline is trading at. They had pre tax profits of 2.46bn last year.

    Absolute madness if people are paying that sort of money. Name and shame the funds who bought into it so you can avoid those traders like the plague. (Im assuming only tax sinks are using it)

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  6. Anonymous Coward
    Boffin

    Let's do it.

    Let's buy it... dot com.

    1 0
  7. Anonymous Coward
    Anonymous Coward

    Overheard in a Groupon Elevator:

    "Sure it's easy to balance the books. All you have to do is move the decimal marker right two places."

    4 0
  8. Aldous
    FAIL

    this feels familiar

    hmmm tech based company that has a huge IPO despite not having a sustainable business model (complete with dodgy financing), complaints from everyone that has ever dealt with them and no sign of profit.

    this all seems so familiar. any way off to party like its 1999

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  9. Andrew Moore
    Thumb Down

    Better still...

    Microsoft/Nokia are currently trumpeting its App Store on TV. And what's the only App shown on the advert? The Groupon one.

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    1. Wibble
      Reply Icon
      Childcatcher

      Re: Better still...

      They're doomed I tell ye...

      2 0
  10. Chad H.

    Well

    What do you expect of a company who's business consists of making its customer's customer unhappy?

    4 0
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