Groupon  and  the  Dutch  daily  deal  market    

 2011  

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• Revenues  • Key  Market  Players  • Market  Shares  • Forecasts  

                   

 

                     Table  of  Contents    Introduction  ..........................................................................................................................................  3  Facts  &  figures:  Groupon  and  the  online  market  in  the  Netherlands  ...........................  4  The  Dutch  (online)  market  ........................................................................................................  4  Groupon  in  the  Netherlands:  key  figures  .............................................................................  4  

The  daily  deal  market  in  the  Netherlands  ................................................................................  4  Groupon’s  daily  deal  results  in  the  Netherlands  ...................................................................  6  Number  of  offers  published  .......................................................................................................  6  Product  Categories  ........................................................................................................................  5  Prices  ...................................................................................................................................................  5  Discounts  ...........................................................................................................................................  7  Buyers  and  Transactions  ............................................................................................................  6  Consumer  spending  ......................................................................................................................  8  Consumer  spending  per  category  ...........................................................................................  8  Conclusions:  more  deals,  less  local,  fewer  buyers  per  deal  .........................................  9  Groupon’s  success  story  in  the  Netherlands  .................................................................  9  The  Downside  .............................................................................................................................  9  Less  local  .......................................................................................................................................  9  Sustainability  of  the  daily  deal  concept  ...........................................................................  9  

Key  Players:  who  are  they?  ..........................................................................................................  10  Would  you  like  to  know  more?  ..................................................................................................  11  About  Media  Intelligence  Lab  .....................................................................................................  11        

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Introduction      Groupon  entered  the  Dutch  market  in  2010  by  acquiring  Germany  based  CityDeal.  Both  the  acquisitions  and  the  rapid  growth  in  the  Netherlands  afterwards  are  exemplary  for  Groupon’s  global  growth  strategy.  We  studied  the  development  of  Groupon  within  the  Dutch  market.      The  document  provides  unique  insights  into  the  Dutch  market  for  daily  deals  containing  key  figures  on  Groupon’s  deals  (prices,  discounts,  number  of  deals  offered,  turnover  figures)  and  the  market  for  daily  deals  (market  size,  key  market  players,  revenues  and  market  shares).  We  also  forecast  on  how  the  daily  deal  market  will  develop  up  until  2015.    About  our  research    During  2011  we  performed  in-­‐depth  desk  research  on  key  market  players:  who  they  are,  their  deals  and  their  sizes.  Next  to  that,  we  gathered  data  on  deals  in  the  Netherlands  which  we  analysed.  Together  we  studied  almost  2,000  daily  deal  offers  and  their  results.  Combining  these  insights  helped  us  to  get  a  complete  picture  of  what  the  market  looked  like  in  2011.              

 

     

Facts  &  figures:  Groupon  and  the  online  market  in  the  Netherlands    

The  Dutch  (online)  market    First   we   would   like   to   present   you   some   key   figures   on   the   Dutch   market   in  order  to  get  the  right  perspective.      

 Figure  1:  Key  facts  on  the  Dutch  online  market  

Groupon  in  the  Netherlands:  key  figures    We  monitored  and  analysed  the  market  for  daily  deals  in  the  Netherlands  during  2011,  resulting   in  some  revealing   facts  about  Groupon’s  size  and  growth   in  the  Netherlands.  We  will  share  some  key  figures  below:  

 

 Figure  2:  Key  figures  Groupon’s  results  in  the  Netherlands    

 

Groupon’s  daily  deal  results  in  the  Netherlands    

Number  of  offers  published        The  number  of  daily  deals  published  by  Groupon  grew  strong  in  the  course  of  2011:  from  30  per  day  to  more  than  150.  The  total  number  of  deals  offered  in  2011  added  up  to  37.000.    

 Cloning  offers  Note  that  similar  deals,  published  in  two  different  cities  are  considered  to  be  two  different  deals.  This  way  Groupon  ‘artificially’  increased  their  number  of  offers  published  by  cloning  their  offers.      

Figure  3:  Numbers  of  offers  published  by  Groupon  in  the  Netherlands  (Q1-­‐Q4,  2011)  

 

Discounts    Discounts  of  offered  deals  averaged  58,5  %  in  Q1.  During  the  year  they  went  slightly  down  from  59,2  to  58,0  %.  This  was  due  to  the  growing  amount  of  Travel  deals  within  Groupon’s  daily  deal  offers.  Travel  vouchers  carry  the  lowest  discounts,  with  averages  down  to  47,6%  (Q3,  2011).    Between  Q1  and  Q3  Travel  voucher  discounts  dropped  by  almost  10  points.  Within  the  category  Products,  discounts  went  up  by  almost  5  points.  Discounts  in  the  local  categories  (Restaurants  and  Activities),  also  went  up.      

     

Figure  4:  Average  discount  Groupon  Vouchers  -­‐  by  Category  Q1  and  Q3,  2011  

 

Consumer  spending    Groupon’s  revenues  experienced  an  average  of  50%  quarter-­‐on-­‐quarter  growth  in  the  first  3  quarters  of  2011.  Last  quarter  growth  we  estimate  at  65%  because  of  the  December  holiday  season.  

 Figure  9:  Groupon’s  estimated  quarterly  revenues  in  the  Netherlands:  2011  

Consumer  spends  per  category    At  the  start  of  the  year,  most  consumer  money  was  spent  in  the  categories  Activities,  Café&Restaurant  and  Health&Beauty.  During  the  year  this  changed  in  favour  of  the  category  Products.  The  relative  importance  of  this  segment  grew  from  4.5%  to  33.5  %  in  six  months  time.    

   Figure  10:  consumer  spends  per  category  

 

 

Conclusions:  more  deals,  less  local,  fewer  buyers  per  deal      

Groupon’s  success  story  in  the  Netherlands    It  is  clear  that  Groupon’s  strategy  focuses  on  fast  worldwide  expansion.  This  expansive  strategy  made  it  market  leader  in  the  Netherlands  where  –despite  a  large  number  of  competitors  -­‐  Groupon  was  able  to  get  hold  of  more  than  83%  of  the  market.  Quarter  on  quarter  turnover  growth  (CQGR)  was  more  than  50%  on  average.  This  resulted  in  revenues  of  around  115  million  euro  for  2011.      The  number  of  deals  offered  grew  even  faster  than  the  number  of  vouchers  for  deals  purchased,  resulting  in  a  decline  of  buyers  per  deal  (162  to  53)  between  Q1  and  Q3.  This  is  illustrated  in  the  chart  below.  Turnover  growth  was  mainly  accomplished  by  raising  average  deal  prices.    

 Figure  5:  illustrating  growth  of  deals  offered  by  Groupon  vs  average  purchases  per  deal  

The  Downside    Groupon’s  entry  into  the  Dutch  market  may  have  been  a  success  story,  there  are  reasons  for  concern  about  what  it  will  do  in  the  future.    

Less  local  Although  Groupon  is  well  known  for  providing  local  offers,  we  see  that  its  offers  became  less  local.  So-­‐called  National  Deals  are  increasingly  responsible  for  the  company’s  turnover.  Additionally  City  Deals,  which  are  meant  to  provide  in  local  offerings  are  more  often  offered  by  non-­‐local  merchants  (such  as  web  shops).  

 

Key  Players:  who  are  they?  

   

Figure  6:  key  players  daily  deal  market,  their  estimated  revenues  and  who  they  are  

 

   

   

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