Groupon Inc. (GRPN) fed the bulls on Oct 10 when they announced an update to their Breadcrumb point-of-sale system which helps businesses to better tailor what deals people are seeking. The news overcame recent bearish predictions out of Wall Street that told of a major correction soon coming Groupon’s way.
Breadcrumb Update Energizes Investors
As Groupon is a daily deals site, it behooves them to assists their client companies in designing the most attractive deals possible, which they do through the point-of-sale iPad app Breadcrumb.
Groupon’s Varun Krishna wrote, “Our team spent countless hours conducting on-premise research and interviewing merchants about their biggest point-of-sale obstacles.” Using this customer feedback Groupon instituted several updates to the system, which were unveiled Oct 9 at the Money 2020 conference.
The updated Breadcrumb point-of-sale system stores consumer contact information, analyzes the patterns of goods purchased, and assigns specific customers to specific employees.
Bears Make Their Case Against Groupon
Concomitant with the updated Breadcrumb app, analysts began grumbling that Groupon’s highly successful year might be coming to a close. The company’s shares are up 111 percent in 2013, gaining a substantial boost resulting from a positive second quarter earnings report.
However, it was positive in that Groupon didn’t lose as much money as anticipated, only posting $7.6 million in losses. And the future doesn’t look brighter. A company can only live on promises for so long, and Groupon might never turn a real profit.
As John Shinal of Marketwatch pointed out, “No one is expecting actual third-quarter net income for Groupon… it’s the same (problem it’s always been: the company hasn’t been able to operate profitably on a consistent basis.”
Groupon is also experiencing major competition from much larger companies Amazon.com, Inc. (AMZN) , Google Inc (GOOG) and Facebook Inc (FB) , and might not be able to survive if those tech giants encroach any further on the daily-deals market.
Groupon was up 6 percent in early trading.
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