Google Should Only Buy Groupon if…

December 1, 2010

They’re smart.

The biggest purchase in Google’s long history of acquisitions has yet to happen, but it’s about to.  It’s a $6 Billion plus offer that makes a lot of sense for both companies.

Having never met Groupon’s founders, or any members of the team other than a few phone calls with some of their sales reps, I cannot attest to the vision or goals of the company.  But to be acquired by Google can’t be too far down on anyone’s wish list.

As far as the huge valuation that Google has given them, I would warn that Groupon is worth every bit of it, and then some. In a field that is quickly becoming overcrowded with clones, Groupon has demonstrated an ability to stay relevant, and become even more relevant.  As the local coupon company that took a deal a day to the next level, as the company that today thousands try to imitate, Groupon has set themselves apart.  And through the right kind of marketing, and the right kind of positioning, they’ve built an army of potential consumers for every brand.

Here’s a hint that every potential business owner should take from Groupon: create a way for consumers to get deals on products that they most likely would have bought anyway at full price, and you’re bound to make anyone happy.  In a lot of ways, that was Walmart’s vision when they got Sam Walton got started back in the early 60’s.  Serve the under-served yes, but offer deals on products people need or want based on another company’s advertising.

In any case, am I surprised that Google didn’t try to create their own clone? Yes. Am I surprised they’re interested in Groupon’s business? No. It opens up new doors to Google’s plans to take control of the “local” business of mobile and web apps.  Using Groupon in conjunction with other Google services may prove Groupon to be the company’s most successful acquisition ever.

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