Google Launches Daily Deal Service
After Google reportedly failed to purchase Group-On several times last year for around $6 billion, they sought to enter the group buying space as a competitor as quickly as possible. Group-On made it apparent to Google that they wanted to take their offering public with their continued growth and almost $1 billion in fundraising. In January 2011 news finally leaked that Google Offers would be launched to compete with group buying coupon services like Group-On and LivingSocial.
Google Offers officially launches today with deals available to the test audience of Portland, Oregon; with plans to expand testing to San Francisco and New York soon. Google’s Executive Chairman, Eric Schmidt recently demonstrated the new service to attendees at the D9 Conference in Palos Verdes, California. He explained that the difference maker for Google Offers is its integration with the new Google Wallet mobile payment platform.
“Google Wallet is a key part of our ongoing effort to improve shopping for both businesses and consumers. It’s aimed at making it easier for you to pay for and save on the goods you want, while giving merchants more ways to offer coupons and loyalty programs to customers, as well as bridging the gap between online and offline commerce.” – Google Mobile Blog
This combination of mobile payments and the group buying experience really makes Google Offers appealing to small businesses; especially because Google won’t charge rate fees for transactions (make percentage off coupons sold). Security lies within the wallet’s ability to store encrypted payment card credentials on your cell phone chip called the Secure Element. You will be able to store gift cards as well as prepaid or normal Credit & Debit cards. It also requires you use a PIN number like the one you would use for bank ATMs. It will be very interesting to see how well the testing goes today, but obviously will need more markets to start scaring Group-On.
Group-On and LivingSocial should be a little worried about this major release by Google. People will respond better to easier payments and less hassle. The Google Wallet is a Mobile Application; you have the ability to quickly and safely pay merchants, turning your phone into mobile payment card. Competition will always lead to the development of new technologies, services, and brand offerings at the price best fit for the consumer.
What do you think will happen to Group-On and LivingSocial? What other changes do you expect to see in the group buying market?