Challenges You Can Face While Developing an App Like Groupon

However, what challenges can you face? If you want to create a Groupon like app, we have analyzed all the problems that may appear during it's creation.

We should note that from the technical point of view the development of apps like Groupon is a relatively easy process but your marketing strategy should be top-notch to attract users to such product.

Groupon is a service that offers it's users to purchase coupons for services and goods. In turn, coupons guarantee discounts up to 70%. The service itself is a mediator that promotes businesses.

The point is that Groupon generates motivated customers for it's partners. So, if the service has managed to sell the number of coupons requested by a partner -- it gets a commission. But if not -- partners can refuse to provide a promised discount and do not pay to Groupon anything at all.

However, the practice shows that in most cases Groupon overdoes the plan requested by the partner and gets 50% commission.

There are a couple of reasons for Groupon's popularity. First of all, the target audience of this service consists mainly of young consumers who willingly spend money (especially if you offer them a discount). Generally, the discount is the main thing motivating users to action.

Secondly, Groupon is viral due to it's well-thought-out marketing model that offers users 10$ for sharing it with their friends.

We can single out several main problems of apps like Groupon. The main problem is that such a business is considered to be risky since it's business model can be easily plagiarized. That fact is proven by numerous Groupon's clones that appeared soon after the service gained popularity.

One more problem is connected with a business model of similar services that can be inefficient in some cases. Initially, the Groupon's strategy was to offer high discounts from different companies. This way, their partners consciously have some profit losses in favor of attracting loyal customers.

However, taking into account the fact that the main Groupon's partners are small and medium-sized companies. Such spending is not always reasonable for them. That's because they get a 'one-time' customer driven by a discount instead of a desired loyal one. Groupon has found a way out and started to sell ordinary goods. So, the service partially turned into another e-commerce store.

Another problem is that to create a Groupon like app, you have to invest a pretty penny in advertising to promote various products and services. For instance, the company promotes membership in different clubs, cruise voyages and so on.

Other apps like Groupon have to do that because that is a kind of a product an ordinary consumer does not purchase every day or week. Besides, such an advertising not only helps them to complete a sales plan but remember customers about themselves as well.

Groupon is not still present in a variety of cities. So, there is a probability that the region you have chosen is free from any kind of group services. That is why you can create a Groupon like app of your own. Being a local citizen, it is much easier for you to learn what kind of group deals people from your region really need.

Except for Groupon, there are a number of companies providing their users with similar kind of service in certain regions. Underneath you can see some of their most popular representatives.

If you decided to create an app like Groupon you should focus on such vital factors in the business model as:

• Reducing the cost of attracting customers;
• Reducing customer churn;
• Continuous improvement of the services you offer. 

Finally, we came to the technical part. As we mentioned earlier, the creation of an app like Groupon is relatively easy but still requires some basic features.

• Login / Registration;
• Personal profile;
• "Invite a friend" feature;
• Nearby offers;
• Determining the location of a user;
• Offers (food, spa, restaurants, shops, etc.);
• Order management modules;
• Several cities and categories;
• Multi-language support;
• Multiple payment gateways;
• Seller's personal account;
• Multi-currency support. 

The final price of a Groupon like app development depends on whether you choose iOS app development, Android or both. For example, Groupon had developed a web version of it's service and only through some time got to mobile development.

However, remember that apps like Groupon demand a powerful marketing strategy in order not to fail. So, we can recommend you to develop an MVP of your service, test it's viability, and change or replace features depending on your customers' reaction.

In case you need a reliable partner -- contact our managers to get more information and get a free consultation.