Google buys Groupon rival DailyDeal

Google has bought German online voucher site DailyDeal.de for an undisclosed sum, as the internet giant looks to take on Groupon in the lucrative flash sales market.

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The site offers Groupon-style daily deals in Germany, Austria and Switzerland, with plans to expand into more European countries.
It was founded two years ago by brothers Fabian and Ferry Heilemann, who will both stay on board.
A post on the DailyDeal.de website reads: “When DailyDeal was founded in Berlin back in December 2009, there was just the two of us.Since then, we have seen tremendous growth, as people throughout Germany, Austria and Switzerland have used DailyDeal to find local deals on their favourite restaurants, travel destinations, entertainment venues and retail outlets.”
“We’re excited to announce that we’ve been acquired by Google. What began as a two-person start-up less than two years ago has transformed into a trusted platform to connect businesses with consumers. By combining our expertise with the Offers team at Google, we hope to expand our efforts to provide even greater deals to consumers.”
Currently, Google’s own daily deals service, Google Offers, is only available in North America, and the acquisition suggests Google has its sights set on the European daily deals market.
However, according to a report by Yipit, Google Offers is already in decline within its first three months, with total revenue dropping 23 per cent in August from July in spite of an increase in the number of deals advertised.
Since Groupon’s launch in 2008, the daily deals industry has exploded, developing into a multibillion-dollar industry and internet sensation, though interest in such services may be flagging.
Competitors keen to get a slice of the pie like Google, Living Social, Amazon.com and Facebook, flooded the market, with varying degrees of success.
While Amazon Local managed to generate $1 million revenue in August, Facebook announced the discontinuation of its in-house daily deals service, Facebook Deals, after only four months.
Across the board, the once red-hot market seems to be experiencing a deep-freeze, with deal titan Groupon reporting a second quarter loss of $102.7 million in the second quarter, and competitor Yelp cutting the size of its sales team in an effort to adjust to the changing market.
As of yet, Google has yet to comment on the acquisition of DailyDeal.de.

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