Groupon enters top ten - Top France travel sites, December 10 2011. Interesting developments in France after Groupon Voyages quietly slipped into the top ten travel websites this week, unseating vacation rental site Homelidays.
The entry in the list of leading destination and accommodation websites is a first for Groupon in any of the major travel markets in the world, although the market share is at the moment registering just 1.4%. The leading website in the category, EasyVoyage, currently has around 21% market share. Pack light for Groupon around the world flights with Delta, Air France, KLM and Alitalia. Who says travel agents offer airlines the most-high yielding flight bookings?
What about Groupon and its Jet Set Adventure? On December 13, Groupon will offer two pairs of around the world (Northern Hemisphere only) economy class tickets for $10,000 and one pair of business class tickets for $20,000 through Delta Air Lines, Air France, KLM and Alitalia. The tickets include up to 10 stopovers in North America, Europe and Asia plus three excursions (worth up to $500 each), all coordinated through a “Grouponcierge.” The flight vouchers for travel, which must begin in a US city, need to be redeemed by December 12, 2012, with travel completed by November 8, 2013. Yipit: Groupon Getaways grew 50 percent in November in North America. Even before its IPO, Groupon indicated that travel would be a key growth driver and it is indeed turning out to be so.
This may be one reason that Expedia CEO Dara Khosrowshahi explained at a recent investors’ conference that the company is pleased with the Groupon partnership and the added reach it brings. Getaways with Expedia and travel booming. Groupon finally published an internal email which rankled regulators, and in it CEO Andrew Mason says Groupon Getaways with Expedia “will do $10 million in its first calendar month.”
Mason sent the email to employees Aug. 25, about six weeks after Groupon and Expedia began rolling out their vacation product. The letter drew the ire of the US Securities and Exchange Commission, largely because would-be IPO players aren’t supposed to communicate financial information to employees if the same information is not made public for the benefit of investors. Groupon published the email as part of a larger amended S-1 registration statement Oct. 7. In the email, Mason characterizes some of the media reports about the financial challenges of Groupon and the group-buying space in general as “hilarious” and “nonsense,” and he sought to provide “some ammo to argue back against your blog-reading ‘friends.’” Report: Groupon Grew Its Revenues 13% In August, Gained 2% Marketshare. In light of reports that the company was canceling its investor roadshow and postponing its IPO, daily deals aggregator Yipit has some positive information about Groupon’s trajectory in August, namely that it had a banner month revenue-wise.
The daily deals frontrunner grew 13% during the last month of summer, increasing its revenue to $120.7 million from $106 million in July. This growth broken down symbolizes a 10% increase in the number of Groupons sold per deal and a 5% increase in the average Groupon price, both increases compensating for a decline in the number of deals ran by Groupon. Groupon's Sales Expected To Grow 224% In Q4. Groupon's gross billings are expected to grow 224% for the fourth quarter of this year, says Benchmark analyst Frederick Moran in a note this morning.
It's strong growth, but for a company that was in hyper-growth growth mode, it's actually relatively weak. Gross billings were up 1,405% in Q1, up 916% in Q2, and up 480% in Q3. (Gross billings represent total Groupons sold, not Groupon's cut of the revenue.) Of course, there's not much Groupon can do about the tough comparisons -- 224% growth is good. Groupon takes tour operator route in France and Germany, OTA next. Flash deals service Groupon says it is establishing itself as an online travel agency as the next logical step for it in Europe.
The company has already set up separate tour operating companies in France and Germany enabling it to legally package tours through Groupon. According to Gregory Linn, director of hotel and travel – Europe, Groupon is ‘little by little becoming an OTA with a difference’, which will enable it to capitalise on customers receving deals twice a week but not necessarily getting what they want. “We want to give them a second choice to go to a more traditional mode but still with more interesting packages.”
Linn adds that the company is currently looking at XML development to help it go down the OTA route. Speaking at a Travel Technology Initiative session on Optimising Digital Sales, Linn says 70% to 80% of customers have no intention of buying so are already removed from the average 15 sites and five-week planning that most consumers go through. Groupon Getaways aren’t the deal they seem to be. Groupon has made its business off selling deals that sound too good to be true: restaurant meals for half off, dirt-cheap massages and manicures, even trips to the dentist for 75 percent off the regular price.
This has been a boon to consumers, especially during these difficult economic times. With its recently launched Groupon Getaways product, Groupon is bringing the same pitch to travel. Only this time, the deals that sound too good to be true may actually be too good to be true. While the main page features beautiful pictures of luxurious hotel rooms and sun-swept beaches that entice users to click the “Buy!” Button, most come with significant restrictions. Consider these partial restrictions from one recent deal: I’ve seen restrictions on Groupon Getaways that have extra cleaning fees of $175-$400, which is a significant percentage of the deal price. Most deals also have blackout dates and availability restrictions. Groupon boosts travel investment with Uptake acquisition.