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As the world reopens, Groupon’s pushing to be much more than a deals site

The daily deals platform is now trying to be a full-on "local experiences" system.

Photos of Groupon's redesigned app

Groupon is redesigning its app to offer more personalization.

Photo: Groupon

The pandemic was not kind to Groupon. Which isn't terribly surprising, given that the company makes money by helping local businesses sell things like massages, manicures, escape rooms and housework. As COVID-19 forced people to retreat into their homes, the market dried up.

But the world is beginning to reemerge, and Groupon seems to sense an opportunity. Not just to get back to where it was, but to make a crucial and complicated switch from daily-deals site to an all-in-one platform for local experiences. To be the place users go not just to splurge on a massage on vacation, but to hire their house cleaners and book all their workout classes. Groupon estimates that people have about 80 "Grouponable" moments a year, CTO John Higginson said, and right now only buy a few of them on Groupon. He'd like to change that.

Groupon is redesigning its app to offer more personalization, as the company begins to invest in machine learning to help figure out what users might want to do and buy in a more detailed way. It's also improving search and rankings to make things easier to find.

But the most significant change, at least in terms of Groupon's whole reason for existence, is the app's new tools for quickly buying deals you've already bought. That would once have been anathema to Groupon's entire purpose, and the platform wouldn't even allow it. Groupon was the place to discover new things, not a way to get better deals at the places you already know.

Groupon has been working with merchants for months to try to make repeat buying work. It relaxed some of the rules on what and how a business can sell through Groupon, and gave them new tools for doing things that look a lot less like flashy coupons. The platform helps merchants figure out pricing and timing, but ultimately leaves things up to the business. "If you had been going to a hair salon for a deal they had that's, like, a complete makeover," Higginson said, "now we want that salon to be able to advertise and promote services for everyday haircuts or coloring. You can do that on Groupon."

Deals will continue to be a big part of Groupon, Higginson said, but he hopes they can be blended with regular sales in a more sustainable way. "Daily deals have a big role in customer acquisition," he said, "even in offline commerce." Groupon's also betting on that business coming back in a big way, as people embrace their Hot Vax Summer and go back to doing fun things in the world. "But then once they become customers that first time," Higginson said, "let's make it easier for them to be repeat customers." Groupon has never been good at that, but that's a big part of the company's focus going forward.

This is about to be a seriously crowded space, though. Airbnb continues to bet on Experiences, which still serves a more vacation-focused need but could become a big platform for all things local business. Yelp, Facebook, Google and the other platforms that have invested in making local businesses easier to find online are all investigating ways for those businesses to sell things through their platforms. And during the pandemic, many businesses have been forced to adapt to online ways of doing business, meaning they may not need platforms and intermediaries at all.

Higginson said his case to merchants suddenly overwhelmed with online options is a simple one. "We have the reach and the scale, we have the tools," he said. But also: "It's not like you pay a subscription to get on." Groupon takes a cut when a business makes a sale, which he hopes aligns the two sides more than an ad-supported social network. Plus, Groupon's integrating with booking platforms, calendar systems and the like, in the hopes of making Groupon a no-brainer option even for companies who also sell elsewhere.

One challenge for Groupon will be training its users to think of it as more than the flash-deals site that made it a household name. That's why the launch is coming now, Higginson said. "We think that's part of the magic of this moment," he said. Redesigning the app catches users' attention, "and allows us to tell the story about what the new, evolved Groupon is going to look like." With millions of people reemerging from lockdown and newly free to do even simple things like get a haircut or go to the dentist, there's a brief window of opportunity to insert yourself into people's new routines before the new normal sets in stone. Groupon doesn't want to miss it.

Protocol | Workplace

Silicon Valley has a new recruitment strategy: The four-day workweek

Everything you need to know about how tech companies are beta testing the 32-hour week.

Since the onset of COVID-19, more companies have begun to explore shortened workweeks.

Photo: Matteo Colombo/Getty Images

At software company Wildbit, most employees are logged off on Fridays. That's not going to change anytime soon.

To Natalie Nagele, the company's co-founder and CEO, a full five days of work doesn't necessarily mean the company will get more stuff done. She pointed to computer science professor Cal Newport's book, "Deep Work," which explains how a person's ability to complete meaningful work cuts off after just about four hours. That book, Nagele told Protocol, inspired the company to move to a four-day workweek back in 2017.

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Sarah Roach

Sarah Roach is a reporter and producer at Protocol (@sarahroach_) where she contributes to Source Code, Protocol's daily newsletter. She is a recent graduate of George Washington University, where she studied journalism and mass communication and criminal justice. She previously worked for two years as editor in chief of her school's independent newspaper, The GW Hatchet.

When the COVID-19 crisis crippled societies last year, the collective worldwide race for a cure among medical researchers put a spotlight on the immense power of big data analysis and how sharing among disparate agencies can save lives.

The critical need to exchange information among hundreds of international agencies or departments can be tough to pull off, especially if it's medical, financial or cybersecurity information that is highly protected by regulatory guardrails.

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James Daly
James Daly has a deep knowledge of creating brand voice identity, including understanding various audiences and targeting messaging accordingly. He enjoys commissioning, editing, writing, and business development, particularly in launching new ventures and building passionate audiences. Daly has led teams large and small to multiple awards and quantifiable success through a strategy built on teamwork, passion, fact-checking, intelligence, analytics, and audience growth while meeting budget goals and production deadlines in fast-paced environments. Daly is the Editorial Director of 2030 Media and a contributor at Wired.
Power

The game industry comes back down to Earth after its pandemic boom

Game company earnings reports this week show a decline from last year's big profits.

The game industry is slowing down as it struggles to maintain last year's record growth.

Photo: Cyril Marcilhacy/Bloomberg via Getty Images

The video game industry is finally slowing down. After a year of unprecedented and explosive growth due to the COVID-19 pandemic, big game publishers and hardware makers are starting to see profits dip from their 2020 highs and other signs of a return to normalcy.

This week alone, Sony and Nintendo both posted substantial drops in profit compared to this time a year ago, with Sony's operating income down more than 40% and Nintendo's down 17%. Grand Theft Auto maker Take-Two Interactive saw a dip in revenue and said its forecast for the rest of the fiscal year would not match last year's growth, while EA posted a revenue bump but an operating income decline of more than 43% compared to this time a year ago. Ubisoft, which reported earnings last month, saw its sales and bookings this past quarter drop by 14% and 21%, respectively, when compared to a year ago.

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Nick Statt
Nick Statt is Protocol's video game reporter. Prior to joining Protocol, he was news editor at The Verge covering the gaming industry, mobile apps and antitrust out of San Francisco, in addition to managing coverage of Silicon Valley tech giants and startups. He now resides in Rochester, New York, home of the garbage plate and, completely coincidentally, the World Video Game Hall of Fame. He can be reached at nstatt@protocol.com.

Allocations wants to make it easier to invest in startups as a group

Now valued at $100 million, it's emerging from stealth to challenge Carta and Assure in the SPV market.

Kingsley Advani, CEO of Allocations, wants to make it easier to form SPVs.

Photo: Allocations

Software is eating the world, including the venture industry. Carta and Assure have made it easier than ever for people to band together on deals. AngelList's venture arm debuted new ways to create rolling funds. But the latest startup to challenge the incumbents in the space is Allocations, a Miami-based startup that's making it easy to create and close special purpose vehicles, or SPVs, in hours.

"If you look at Pinduoduo and group shopping, SPVs are group investing," said Kingsley Advani, Allocations' founder and CEO. Instead of one investor having to cough up millions, multiple people can write smaller checks in an SPV and invest as a cohort. It's a trend that's taken off in 2021 as investors compete to get into hot startups.

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Biz Carson

Biz Carson ( @bizcarson) is a San Francisco-based reporter at Protocol, covering Silicon Valley with a focus on startups and venture capital. Previously, she reported for Forbes and was co-editor of Forbes Next Billion-Dollar Startups list. Before that, she worked for Business Insider, Gigaom, and Wired and started her career as a newspaper designer for Gannett.

Protocol | Fintech

How BankProv switched from community banking to crypto banking

BankProv is almost 200 years old, but it's competing with new banking startups by going after the newest area of finance — crypto.

BankProv's main office in Amesbury, Massachusetts hearkens back to its past. But the bank is looking to the future.

Photo: Google Street View

When BankProv was started, horse and buggy was state of the art for moving money. Now it's looking to use bitcoin and ether.

The bank was founded in 1828 as the Provident Bank — a name it kept until last July — and now wants to be a key provider for crypto companies that need banking services.

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Tomio Geron

Tomio Geron ( @tomiogeron) is a San Francisco-based reporter covering fintech. He was previously a reporter and editor at The Wall Street Journal, covering venture capital and startups. Before that, he worked as a staff writer at Forbes, covering social media and venture capital, and also edited the Midas List of top tech investors. He has also worked at newspapers covering crime, courts, health and other topics. He can be reached at tgeron@protocol.com or tgeron@protonmail.com.

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