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Now comes phase two: Completely changing its business model.
Groupon is preparing to launch Groupon Now, a mobile app that will connect customers with real-time coupons for retailers in their vicinity. Tap the app's "I'm hungry" button, and you might be offered a discount on a slice at a pizza parlor a few blocks away. But you'll have to move fast: The deals will be time-sensitive and good for just a few hours.
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But first, Groupon has to prove it can make Groupon Now work. Real-time, location-based discounting is a simple idea that's fiendishly complex to pull off. On top of building a technical infrastructure that can handle all the variables -- "you're talking about multiple deals that are in walking distance during certain times that only last for an hour or two," Rudin notes -- you need a constantly updated supply of merchants willing to offer deals.
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