by Carlos Macías
Plenty of cash flows for start-ups like Groupon, a company that sells daily discount deals using their website and social media sites. In a bold move, they rejected a whooping $6 billion takeover bid from Google. Instead, they are working the details to offer their first I.P.O. with a market valuation of $15 billion. In the meantime, they also raised $950 million from private investors, according to The New York Times. These numbers show how confident investors are in the power and potential of collective coupon sales.
But how does this work? In a nutshell, Groupon and other companies like LivingSocial design tailored daily discount offers with merchants, and then offer them to a growing database of more than 24 million people and 150 cities in the Unites States alone. Shoppers sign up on their website and provide their ZIP Code to receive daily promotions. The trick to offer anywhere from 50 up to 90 percent discounts is that a determined minimum amount of people must commit to the sale before it is activated. Once that minimum is reached, the deal is on. The sweetness of this service for small business owners is that they can deploy marketing campaigns with no money upfront. Also, it is a gateway to the growing online market for small businesses that don’t have an established web presence.
Imagine what this service can do for Latino businesses nationwide. Let’s enumerate the best five reasons why the Latino market is fertile ground for Groupon:
1. Economic growth is led by Latinos: According to the U.S. Census Bureau, “the number of Hispanic-owned businesses in the United States increased by 43.7 percent to 2.3 million, more than twice the national rate of 18.0 percent between 2002 and 2007.” Like most immigrants, Latinos are natural entrepreneurs.
2. Social media is dominated by Latinos: The Pew Research Center’s Internet & American Life Project determined that 18 percent of Latinos use Twitter compared to 13 percent of Blacks and 5 percent of Whites. Also, Latinos are closing the gap on Internet usage. Just ask Being Latino or Latinos in Social Media (Latism) for some traffic data. Your jaw may drop.
3. Purchasing power: A recent report from the Selig Center for Economic Growth at the University of Georgia Terry College of Business says that despite the recession, the Latino market is expected to grow 50 percent, from $1 trillion in 2010 up to $1.5 trillion in 2015. We are working and spending, a lot!
4. Acculturation levels: The old notion that Spanish is the only language to connect with Latinos in the United States has been debunked. A white paper from comScore says that 70 percent of Latinos prefer to surf the Internet in English. Companies like Groupon just need a little seasoning on cultural intelligence and voila! This could be one of the best business opportunities of the decade.
5. Mobile Internet is also our turf: Sharing the top spot with Blacks, English-speaking Latinos are “the most active users of the mobile web.” So far, we text, take pictures, and access the Internet, among other things. The next frontier? Shopping online using our smartphones.
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To learn more about Carlos,
visit www.carlosmaciasweb.com.
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Disclaimer: The views and opinions expressed in this article are solely those of the author and should not be understood to be shared by Being Latino, Inc.
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Being Latino Online Magazine 