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Thanks to calm things that full well how are these deal of the day's sites like Groupon impacting consumers shopping habits.
Let's ask the talented blonde retail analyst Kristen Benz -- joins us right now from Phoenix -- you just heard from Nicole's over the traders signing up board.
I these scalp -- floor for restaurant so everyone's kind of you'll blue and putting -- they're big -- if you will in this illicit when I was growing trends that we're gonna see for years.
You know now that it actually IPO I think the trend is kind of breaking down a little bit -- and I think people are suffering from deal fatigue and I -- So giving -- government Kristen where you see this company going in and what's driving that fatigue is it just proliferated in -- market too quickly.
Well you know if you back to business school 101 and porter's five forces model.
They're no barriers to entry for his -- so they they have about 350 competitors and that's growing.
Needless to say you have you know Google coming out -- shopper.
-- Amazon so those are you know big -- to have to spend topping out at at the folks at Zynga are you know busting up the stand.
Campaign courts today.
Yet you know it -- did reasonable I guess say you could say 35 million shares at twenty dollars maybe a little better than some people had thought on this RI PO Kristen but what.
When you look at Google -- such a huge competitive calm and -- could stamp out everybody what gives them an advantage.
Over everybody else is -- to sheer size.
I act size matters size definitely matter I think.
And when we'll -- -- where does size matter in the retail sector here I mean is -- the relationship you have with the individual merchants and the fact that you can just put more deals together.
Well here's the problem with Groupon they're actually focusing more on and national level.
Which actually -- their margins down instead of focusing on a local level he's so those local daily deals that you have yeah we have one here at Phoenix called deal chicken.
They actually are work much closer with god the small business owners and at a much better relationship Chris is a problem how.
Businesses are receiving these deal web sites.
-- -- -- Is part of problem how businesses are dealing with these or how they're accepting -- how interest and businesses is in the business and is -- selves are with these.
There's off the taxing issue that a lot of small businesses have to pay tax.
On the full amount of big deal not that discount but the consumer is actually paying if you.
And so that's not really working out so great for them and a lot of these deals you know.
We're we're teaching the consumer to buy on the dip.
Most of these -- consumers that -- of these daily deals they're not gonna come back again to pay full price yeah so it's like -- lots leader you a lot of people.
Buying a lot of deals but basically what I'm seeing what -- research Groupon.
Is -- got a small amount of people doing a small ideals -- and he's not what merchants want.
And you're not recommending buying shares of Groupon then Kristen is or any other public company right now that you would be more interested in that would be a competitor like I mean we're talk about Google lot earlier.
Good vol Amazon and travels ill come -- is that fat.
Gilt Groupe gilt Groupe -- you think that's a luxury plane but out -- doing great things I'd love to see them go public absolutely -- Real quick Christa I'll have a couple seconds but as you you know you talk about the year.
-- you're researching the Groupon.
Obviously businesses want written they want new customers they wanna use these deal a -- cites for new customers are they finding that they're just getting BP customers in getting bargains that he would have might -- the stuff anyways.
They're getting new customers but those customers are coming back I remember it takes.
It takes more money to bring in a new customer and maintain because the customers that you -- yup so I don't think you know.
As a retail analysts I would not you know -- and promote that model that's you know having folks -- -- one -- and not come back that's not what we want we want repeat customers paying full price all the time.
-- jealous of you out there in Phoenix the weather looks fantastic.
Thanks for joining us KB 61 and you got it thanks and be it in that prevented it thanks Kristen is the -- when Larry.
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