Groupon’s business faces significant challenges as competition becomes more intense according to an analysis by Vin Vacanti of deals aggregator Yipit.
Vacanti took a look at the latest S1 numbers on Groupon’s Boston business, which is its second oldest market. It’s good to look at a mature market like Boston because it could be provide a window into what will happen elsewhere in the world when the competition catches up.
On the face of it, things look good in Boston. The number of subscribers was up for the second quarter of the year versus the first quarter. Revenue was up on a quarter over quarter basis. Featured merchants grew as well.
But beneath these numbers lies a troubling trend, according to Vacanti. Groupons sold per subscriber was down. And revenue per merchant was down as well. These two metrics suggest that Groupon’s bottom line is in trouble.
Vacanti summarizes his analysis by saying, “Groupon is spending considerable money to acquire subscribers but those subscribers are buying less Groupons. Groupon is also spending considerable money to acquire merchants but are making less revenue per merchant. That’s not good.”
Free games are now generating the majority of the revenue amongst the top 100 grossing games in the App Store. A free game gets more downloads, and if it’s engaging, and has the right mechanics, it should compel you to pay for features inside of the game.
Only a sliver of gamers — 0.5% to 6% of users says Flurry — actually spend money in a free game. But those that do spend big supporting the developer and keeping the app free for everyone else.
Everything’s coming up Jack Dorsey these days. Last week Apple started stocking Square’s iPhone credit card readers in its 235 US retail locations, and now, according to Reuters, Visa has put its plastic where its mouth is. The credit card giant has invested in the personal payments startup, scoring itself a spot on Square’s advisory board in the process. No word on how much Visa is actually dropping on the company, but one thing stands to reason: it probably didn’t make the deposit via Verifone. If you would like to invest in a Square reader, it’ll cost you a lot less — the company is still offering smartphone plug-ins for free on its site.
Square gets financial backing from Visa, asks to see some ID originally appeared on Engadget on Wed, 27 Apr 2011 21:47:00 EDT. Please see our terms for use of feeds.
Yahoo’s tanking search revenue (down 19%) ruined what would have been an otherwise strong earnings report last night.
Carol Bartz blamed sliding search revenue on Microsoft’s adCenter not delivering high enough revenue per search — her implication is that the ads aren’t as relevant as they were under Yahoo’s system, so users aren’t clicking on them as much.
Danny Sullivan, one of the smartest journalists watching the search business, took a long look at Bartz’s claim and Yahoo’s search business, and he thinks Bartz is too quick the place the blame at Microsoft’s feet.
He found that Yahoo’s search business was declining before the Microsoft deal. It has continued that decline at a steady rate — even if you subtract out the 12% that Yahoo pays Microsoft now that Bing is powering its search results.
Sullivan offers an alternate reason why revenue per search has continued to drop after the Microsoft deal: Bing offers better organic results than Yahoo did, so users are clicking on the actual search results and not relying as much on the ads.
Whatever the reason for the drop in Yahoo’s search, Sullivan calls it a “disaster,” and warns, “The search revenues need to reverse themselves, and quickly, for Yahoo to be convincing that the deal it hawked is really paying off. Otherwise, when 2012 rolls around, and those headwinds have finally slacked off, Yahoo might find it has slowed down to earning Blekko money.”
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While there’s been a lot of talk about whether or not Time Warner has the right to include feeds of cable channels it carries in the new TWCable TV app, besides the company’s voluntary removal of several networks there’s been very little action until now. Time Warner Cable announced this afternoon it has filed a request in the United States District Court for the Southern District of New York for a declaratory judgement regarding Viacom’s cable networks. Time Warner continues to maintain its carriage agreements give it the right to allow subscribers access on any screen in their home, not just the TV and is apparently ready to prove that in court — or at least drive Viacom, Discovery, Fox and other complaining networks towards more favorable negotiations. The app added seven more channels earlier today, while we wait for Viacom’s side of the story you can check out the press release after the break or Time Warner’s official blog to understand its stance in full.
Update: Viacom has responded, saying Time Warner “blatantly grabbed the rights that their competitors have negotiated in good faith to obtain” forcing it to file a lawsuit of its own. The gloves are officially off — check the full text after the break, or a PDF of Viacom’s complaint linked below.
Time Warner Cable takes Viacom to court over its TWCable TV iPad app; Viacom responds originally appeared on Engadget on Thu, 07 Apr 2011 16:46:00 EDT. Please see our terms for use of feeds.
Before a person, company or brand has a reputation crisis, both offline and online, there are specific content assets that can be put in place in anticipation of “worst case” scenarios and pre-emptively own those search results so that the right content comes up. This comes from laying the proper groundwork ahead of time and for specific terms.
Dr. Augustine Fou is Digital Consigliere to marketing executives, advising them on digital strategy and Unified Marketing(tm). Dr Fou has over 17 years of in-the-trenches, hands-on experience, which enables him to provide objective, in-depth assessments of their current marketing programs and recommendations for improving business impact and ROI using digital insights.
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