IP Uh Oh

Groupon Promises to Stop Spending on Things That Don’t Work So Good No More

Just not the best fit, probably.

Groupon filed an amended S-1 document today for its delayed IPO, which has been under scrutiny from investors and the SEC. The startup has been critiqued for the fact that is has had to boost spending to add users to its email list. The filing says the company plans to “significantly” reduce online marketing spending “over time as such investments yield insufficient returns,” reports Bloomberg.

According to the filing, those marketing costs stopped paying off because of ‚Äúchanges in subscriber economics, achievement of subscriber saturation levels in various markets or a determination that subscriber growth objectives can be satisfied though alternative means.”

The company insists that cutting back won’t negatively impact businesses with existing subscribers, although trends have shown users tend to be less engaged and profitable over time. Read More