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Discounts, last-minute deals, limited-time offers, coupons, and sales. Those are the most popular and cherished sales promotion tools in the e-commerce and offline retail sectors.
Most people adore them, and customers are eager to maximise their savings through such promotion channels.
Surprisingly, cutoffs in prices are beneficial for both sides: consumers and sellers. But what makes these tools of the promotional mix even more interesting is that they can be used by third parties and mediators for their own benefit.
Groupon took advantage of that feature and grew its business into a worldwide e-commerce marketplace with over 3 billion in revenue.
Hopefully, you can accomplish such results too. But you’ll need to do something extra that just create an app like Groupon.
First, you’ll need to get an understanding of the inner machinery of Groupon in order to grow your own unique mobile app.
Top groupon alternatives - exclusive deals
There are many websites and apps similar to Groupon.
You can find an app like Groupon for beauty, various Amazon apps like Groupon, and special offer websites in each country where e-commerce exists.
Here are the most popular platforms, that were able to get required traction and fight their place under the sun.
- RetailMeNot – 28.6M Monthly Visits.
- LivingSocial – 650K Monthly Visits.
- Woot! – 9.56M Monthly Visits
- Luxury Escapes – 590K Monthly Visits.
- Fave – 570K Monthly Visits.
- Cudo.
- TravelZoo.
- DealCatcher.
- Yipit.
- ScoutMob.
- Fab.
If you take a closer look at these platforms, you’ll notice that most of them are highly specialized and focused on specific goods categories like gadgets and computers, garden devices, baby toys, fashion clothing, jewellery, lux resorts, etc.
Choose your niche carefully, and make it as narrow as possible! This was our first advice, and we continue to repeat it.
Groupon Business Model Overview
Now, let’s examine Groupon’s finances, revenue streams, and business models, such as mobile apps and websites that benefit local businesses.
How does Groupon make money?
The system leverages the margins of quantity discounts (wholesale discounts). Simple as that!
In essence, Groupon connects the group of buyers for local deals interested in the certain product and the seller, who is ready to provide the product for a reduced price to save money.
That basically explains how Groupon’s naming was born, which is a blend of two words “group” and “coupon”.
Why Groupon is so popular? Due to its best deals.
Coupon Mechanism
Okay, let’s assume you’ve gathered your first group of buyers. But how do you prove that to the seller? That’s where coupons for great deals come into play.
In order to secure the demand (number of interested buyers) the company created coupons. Those are kind of assurance contracts.
Coupons are needed to measure the interest for the specific products and to monetize the platform.
A part of profits from coupon sales goes to Groupon and part to the seller.
At first, there was a 50/50 distribution, now it dynamically changes depending on the number of factors.
Products
One important thing about Groupon’s business model to note is that it features local deals instead of products that are available worldwide.
This practice ensures that buyers are really interested in services and will attend in store places rather than other sites in the near future for new deals.
You can even try to sell some FMCG products, like farmers’ goods, just ensure to keep your geography tight so the logistics can catch up with it.
Moreover, it greatly helps in SEO, because Google prefers to serve “local” content over global-oriented websites.
Alternative monetization models to save money for local deals
- Commision-Based Model – This model can work with and without coupons for best buy. The profits here are generated through the commission. Sellers may pay for a number of visits or purchases.
- You can also use affiliate monetization tactics to get money from a certain number of clicks.
- Such tactics are highly popular among price aggregators and booking platforms like Airbnb Booking.com or Luxury Escapes, which are updated daily.
- Up-Sales and Cross-Sales – Your app can generate additional revenue stream through up-sales of gift boxes, special discounts, limited deals, and bundles.
- Groupon uses it to promote more advanced sitting tours or increase the time spent on the spa visit deal.
- Exclusive Deals – As your app will grow the loyal audience you may also experiment with special deals on site for loyal members or exclusive offers that are available only with a purchase of special coupon.
Just make sure to provide relevant value for money.
How to make your own app like Groupon for the best deals?
At the heart of any Groupon-like website sits a really basic e-commerce store, with little difference: it sells coupons instead of products.
This is from where you can start building your coupon mobile app – e-commerce store.
Admin Panel
There are two different approaches to how brands grow a catalog of your coupon website.
Curated Content
All offers you provide are listed and prepared only by your content management team.
Meaning, if a new seller is willing to place his category on your website, he will be only asked to supply you with a raw content.
Then your content managers will instantly make maximum of it, get additional pictures, refine service description, find reviews, etc.
This is a preferable approach for the first stages of platform growth.
It requires less effort during the development of the admin panel because all the content management will be done manually by hired workers.
Plus, you’ll have a room for manoeuvre. You can experiment with different content formats and find the one which gives a better conversion rate.
Moderated Content
According to this approach all the information on the service will be issued and placed by the seller himself. Just like it happens across all marketplaces.
The sellers get access to the admin panel and can log in and fill in all required fields, then you review the information, check it against your quality standards and submit it.
The moderated Content approach requires a well-developed admin panel. Basically, it requires building a full-fledged CMS system like WordPress.
Such an approach suits trusted coupon websites that have already gained traction or niche products like this Surf&Yoga web portal we’ve made.
UI/UX Design Tips for Coupon Website - don't forget about promo codes
- Engaging Badges & Activations
A well thought-out system of discounts is one the core values of any Groupon like apps. Put maximum care to the badges and countdown timers.
You can even build a hierarchy for all types of special offers your platform will provide. Structure badges based on their importance, and design icons accordingly.
The most important thing here is to not overload your platforms with flashy icons and screaming colors. You should put maximum attention to mockup design.
We strongly advise you to check our article on common mistakes during mockup design.
- Product Centered Coupon Cards
A special place in platforms’ structure sits content and description of the products. Groupon used the army of content writers in order to create such massive and high-conversion web platform.
- Explicit Terms of Use
10 years past the invention of Groupon, the service still may sound confusing to many of your customers.
That’s why we advise you to adhere to a policy of full transparency.
Place Terms & Conditions on every page, at least the short version of it. Keep it simple and fair.
Useful Features for Coupon Aggregator
Countdowns Generator – Timers generator is a must-have thing for any coupon website.
It will drive your sales and it saves a lot of time for your content management team.
Mass Payment Gateways – A payment gateway is an obligatory functionality for any e-commerce project.
But as your platform will grow bigger, there will be too many sellers to keep track of everyone.
That’s why we advise you to develop a mass payment functionality in advance.
Accounting & Statistics – Provide your sellers with access to internal analytics so they can see the results of their marketing efforts on your platform.
Tracking Code Generator – This feature will save you a lot of time. UTM-mark is a common marketing tool used for tracking of traffic and leads.
This tool will help you and your sellers to track traffic, find out best sources, and cross-check your analytics against one that sellers have.
Bottom Line
Creating a coupon website or app similar to Groupon covers more than just setting up a platform—it’s a multifaceted journey requiring careful planning and attention to detail.
Like any business targeting a savvy, high-expectation audience, you’ll need to navigate several critical areas, from securing a solid financial foundation to ensuring every visual and functional aspect aligns with user expectations.
Beyond budgeting and initial design choices, successful coupon platforms require a strategic approach to features, user experience, partnerships, and marketing.
Balancing these elements can be challenging, but it can also be rewarding.
While we’ve only touched on the essentials, there’s much more to explore.
When you’re ready to dive deeper, rest assured we’re here to help at every step!
Contact us to get a free expert consultation shedding light on all unknowns that may stop you.
