Groupon (GRPN) Outpaces LivingSocial in October; Margins in Focus
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New data from Yipit suggests that consumers may be getting more specific about daily deal site they use.
Yipit notes that Groupon's (Nasdaq: GRPN) gross billing for October totaled $176 million, a 22 percent sequential increase, while LivingSocial saw an 8 percent drop to $54.9 million.
Driving gains for Groupon was its new Groupon Getaways site, which offerings deals in conjunction with Expedia (Nasdaq: EXPE). Getaways generated gross billings of $22 million for October, a significant acceleration from $8.6 million reported in September.
Despite the increase in Gateways business, the model generates lower margins for Groupon. Typically, Groupon gets margins of 40 to 45 percent from daily deals, and Gateways generates just a 20 percent margin.
Another arm of Groupon recently added is Goods, which also boasts gross margins of just 20 percent.
However, in a recent presentation, CFO Jason Child said that Groupon's margins have stayed steady at 40 to 45 percent.
Groupon ended Wednesday's session flat, having dropped from an IPO price of $28 at the start of November.
Yipit notes that Groupon's (Nasdaq: GRPN) gross billing for October totaled $176 million, a 22 percent sequential increase, while LivingSocial saw an 8 percent drop to $54.9 million.
Driving gains for Groupon was its new Groupon Getaways site, which offerings deals in conjunction with Expedia (Nasdaq: EXPE). Getaways generated gross billings of $22 million for October, a significant acceleration from $8.6 million reported in September.
Despite the increase in Gateways business, the model generates lower margins for Groupon. Typically, Groupon gets margins of 40 to 45 percent from daily deals, and Gateways generates just a 20 percent margin.
Another arm of Groupon recently added is Goods, which also boasts gross margins of just 20 percent.
However, in a recent presentation, CFO Jason Child said that Groupon's margins have stayed steady at 40 to 45 percent.
Groupon ended Wednesday's session flat, having dropped from an IPO price of $28 at the start of November.
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