Google launches Groupon rival
Website to make offers via social buying model
Google is launching a prepaid offers/vouchers website to compete with other players in the sector such as LivingSocial and fast-growing Groupon.
The move comes after US-based group buying website company Groupon rejected a huge US$6bn acquisition bid from Google in December.
The new offering will be powered by Google Checkout and will include a range of social sharing features designed to spread deals virally.
The new website will employ a similar ‘social-buying model’ to Groupon and offer users a discounted ‘deal of the day’ on a product or service in their town or city.
Offers target specific local markets and the model is seen as a significant source of internet advertising revenue, which may be one of the attractions for Google. The launch may be part of a strategy to extend Google’s Adwords offering beyond the basic text advertising into generating sustainable revenue.
The internet search engine giant said in a statement that it is in talks with small businesses to get them involved in a test run of its new program, initially to be called Google Offers. It did not say when the service will launch.
“This initiative is part of an ongoing effort at Google to make new products, such as the recent Offer Ads beta, that connect businesses with customers in new ways. We do not have more details to share at this time, but will keep you posted,” said Google.
Groupon, which is currently seeking a US$15bn IPO, is expanding rapidly around the world. Earlier this month it bought three companies with similar offerings in Israel, India and South Africa, after completing a US$950m round of investment funding.