Thursday, December 1, 2011

Talk about expenditures... Groupon burn rate goes to advertising

Groupon 

Groupon spent about $613.2 million on marketing in the first ninemonths of this year -- about 55 percent of total revenue for the period -- according to its filings with the Securities and Exchange Commission....

Amazing considering Google spends next to nothing on advertising yet it profits the most... CFO Jason Childs said Groupon has improved its ability to spend marketing dollars more wisely, lowering its subscriber acquisition costs from $32 per customer to $25 per customer...

Wow a $25 acquisition cost just so they can get me to buy that $10 discounted lunch at some place i never heard of...
Actually think about that, one of the worlds most profitable company who built their company on an advertising model for others to pay... They themselves spend almost nothing on advertising....




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