What Do I Need to Do to Start an Online Coupon Business like Groupon?

What could be better than an opportunity to save money? We all don’t mind getting a good discount from time to time, right? That’s why resources providing users with access to discount coupons are gaining popularity today. And a striking example of such a platform is Groupon. This is where the true success story is!


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Thanks to aggregators like Groupon, both user groups benefit: consumers receive a product or service at a better price, and companies increase their client base. Moreover, the site owners don’t remain at a loss too. And what wonder? At least 400 and even 500 thousand transactions are being made per day, so each party gets a piece of the pie.

Looking to join the ranks of Groupon’s competitors? Your dream is ambitious, yet achievable with the proper approach. The main thing is to think over each step in advance.

Surely you have a lot of questions, don’t you? Say, what are Groupon’s secrets? Why is it called Groupon, to begin with? Is it even possible to emulate its success? And finally how to make your own app like Groupon? Where do you start?

Fortunately, we’re going to answer most of these and other similar questions.

Why is Groupon Called Groupon?

It all started with thepoint.com, the first brainchild of Andrew Mason. The site allowed its users to organize joint actions of any kind, from boycotting a new diner to group purchases in order to receive discounts. And although the project itself turned out to be unprofitable, it inspired its owner and creator. That’s when Mason came up with the idea of a collective discount service.

The idea led to building a coupon website in 2008. Initially called getyourgroupon.com, it later became groupon.com, which was shorter and sounded better. The platform conquered US users, and a year later entered foreign markets.

Over the next several years, Groupon had attracted substantial investment from engaged sponsors. The funds received were used to acquire other companies of a similar type (Groupon-like websites) in India, Germany, Chile, Turkey, etc.

Originally, Groupon Business Model was a little different from what it is now. More precisely, users were able to activate a discount only if a certain number of people became interested in the same product or service.

Fortunately, this is a thing of the past, and since 2013 Groupon has been operating as a marketplace focused on local businesses. Shop owners, travel agencies, and other companies are welcome to post their offers and set any validity period. And by the way, they don’t need to pay to do so: Groupon receives a commission only after the coupons are sold.

What Are Websites like Groupon?

These are online intermediaries helping business owners reach new customers with discount coupons. With such a coupon, the user may expect to save from 10% to 95% when buying a certain product or receiving a service (let’s say, when visiting a beauty salon).

What can you do with a Groupon-like website?

  • finding virtual coupons of a specific category, be it entertainment, electronics, fashion products, etc. Also, you have the option to search by brands (Amazon, Nike, Walmart, etc.). After successful completion of the search, you just need to activate the selected coupon and present it (its electronic version) when paying for a product or service. If everything is done right, you’ll get the promised discount.
  • the ability to print a coupon, which comes in handy too (especially if the user is old-fashioned and prefers paper coupons to electronic ones);
  • GPS feature. To be precise, you’re able to activate coupons of establishments nearby (the application will send you a notification at the right time, or you yourself find a discount in the location you need);
  • Deals of the Day, web page offering time-sensitive deals, so to say.

Why are coupon websites so popular?

  • Saving. First of all, these services are popular, as there is an opportunity to save money on buying a product or receiving a service. People love all sorts of discount coupons and willingly purchase them, which logically brings us to the next item on the list, namely…
  • An additional marketing tool. By using aggregators like Groupon, business owners would attract more customers, and it leads to higher income.
  • Timing factor. Discount coupons are valid only for a certain period, which means any offer is relatively short-term. And this gives it additional charm in the eyes of the user. “I might miss my chance to save money! I need to get a coupon right now!” – the user thinks and makes a purchase without thinking.
  • Viral effect. If your Groupon-like website is good, the viral effect won’t be long in coming. Users themselves, of their own free will, advertise your resource by telling their friends about it. Consequently, the popularity of the site is growing.

Once you’ve decided to create your own clone of the Groupon website, you’re sure to be curious about your inspirer’s success story. Perhaps Groupon’s example will give you a couple of useful ideas.

Find Your Niche to Create a Website Like Groupon

Alas, your attempts to measure up to Groupon are likely to be pointless, at least in the initial stages. Of course, if you have the opportunity to attract huge investments, then it’s a different story. Otherwise, it’s better to launch a niche resource of some kind and therefore increase the chances of success. And the more specific and narrower your audience, the better.

Let’s be more specific, though:

  • The most targeted niche. Stop trying to wrestle with the big picture, focus on a specific area of business. A good example is Voucher Wow, which offers discounts on medical cosmetics.
  • Local approach. To create a website like Groupon, capable of reaching the markets of multiple countries, you’ll have to fork out a lot. So sometimes the best strategy is to partner with business owners who operate in your area. Let’s say, Living Social is targeting users in Washington, DC. They can receive discounts on visits to restaurants and beauty salons.
  • Uniqueness. Try to find a feature to make your resource unique in one way or another. The task isn’t easy, but it is in your interest to cope with it.

Surely, you won’t earn billions at once. But you need to start somewhere. Anyway, you’ll have the opportunity to scale your business in the future.

Anyone who plans to create an e-commerce platform from scratch can’t help but wonder what budget is worth preparing. We answer this and related questions in our article.

By the by, do you want to know what business model is used by Groupon? We’re ready to enlighten you on the issue right away.

Groupon Business Model

Owners of aggregators like Groupon usually engage businessmen interested in increasing sales of their services or products (surely, if they don’t mind providing discounts to loyal customers). The next task of the platform is to find the maximum number of users and convince them to purchase discount coupons (and it’s better that they do it on a regular basis). Couponers’ benefit is the percentage they receive from the deal made (usually the figure ranges from 15% to 45%).

To launch a site like Groupon, you should select one of the options below:

  • Traditional approach. In the first case, the user sees the traditional scheme: he finds a suitable coupon, activates it, and presents it at the point of sale of a product or service.
  • Last-minute deals. Also, you can create an app like Groupon in its early days. To be precise, your partners post offers, which are valid for a short period of time. And a user needs to decide quickly, literally here and now, which spurs the buying excitement.
  • Coupon drawing. Another not bad idea is to offer coupons as a prize for completing certain actions (let’s say, registering in an application) or invite users to participate in a lottery.
  • Combined option. One more option is a combined version of the business model for the Groupon clone. Say, why not offer lottery and last-minute deals at the same time? You’ll have more chances to attract users.

Now let’s discuss the basic development methods. You’ll learn how to get launch-ready Groupon clones (online or mobile, or better both).

How to Create a Groupon Like App or Website?

You should start your coupon business by creating an online marketplace, which entails the following steps:

  • buying a domain and hosting;
  • choice of development method;
  • finding a company to do the job (which is difficult and time-consuming);
  • email setup;
  • connection to e-payment systems;
  • other similar work related to the development of apps like Groupon.


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