Google – The company recently offered deals through its Play Store in the holiday season. It offered different deals every day starting from mid-December to Jan. 1 2013. The company is always known for some attractive deals during the holiday season. Google will continue to offer tons of new deals everyday, including apps, games, books, movies, music, TV and hotels, etc, from the Google Play Store. With Groupon currently lacking in its daily deal performance, I feel this is a good opportunity for Google in 2013. Moreover, the company's PLA (product listings ads) is also showing solid performance for merchants with higher click through and conversion rates. We can expect Google PLA to contribute higher figures in its fourth quarter revenue since the ad format is additive and the conversion rates are ranging from 13% to 30%, which is higher than the comparable AdWords ads.
The Foolish Bottom Line
The European region for Groupon is still some quarters away from stabilization, and its mobile monetization continues to disappoint. With bigger rivals challenging the daily deal champ, I am skeptical about Groupon's ability to regain its market share. To sum up, I don't feel at this moment that Groupon offers a suitable risk-reward opportunity to investors. The company's core business of discounted deals is hitting the bottom, and it is trying to venture into new areas. The new segments are the online retail and payments, which are already flooded with competition with various players. Therefore I don't see any turnaround in the near term, and remain bearish on the stock despite its low valuations.
The article Is this Daily Deals Leader Worth Buying Now? originally appeared on Fool.com.
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