Groupon (NASDAQ: GRPN) has been an interesting story of late. The company is in the midst of a multiyear turnaround, and shares were up a whopping 60% this year as of this writing. Of course, that's largely because the stock had fallen so far to begin with, as the current price of just over $5 per share is still a far cry from the stock's $20 IPO price back in 2011.
Can management keep up the momentum and send shares back to previous heights? The answer may lie in a potentially transformational product unveiled this year.
GRPN Year to Date Price Returns (Daily) data by YCharts
The current state of Groupon
Groupon brought on Rich Williams as its new CEO in late 2015, replacing company co-founder Eric Lefkofsky. Williams had been the company's chief operating officer and an Amazon executive before that. In his attempt to right the ship, Williams is working on refocusing the business on its most profitable services and geographies. The four pillars of his turnaround plan are:
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Streamline and simplify the business.
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Increase the number of customers.
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Exit less profitable product lines and geographies.
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Improve the overall customer experience.
The company has been successful in its downsizing efforts, culling product lines and reducing its international footprint from 47 countries to just 15. Still, streamlining and downsizing, while necessary, are not likely to send Groupon's stock soaring. Only No. 2 on the list (growing new customers), which will likely be brought about by No. 4 (improving the customer experience), is likely to do that.
Which brings me to Groupon+.
Groupon wants to link seamlessly with your credit card. Image source: Getty Images.
Discounts without the voucher
Groupon+ was rolled out earlier this year and in early September the company trumpeted the restaurant deals (more than 1,500 participating restaurants in 23 U.S. markets) available under this low-friction system. Groupon+ is, in many ways, a reinvention of Groupon's core product. Traditionally, customers would have to buy their Groupon voucher, print the coupon, and use it within a certain time frame.
With Groupon+, however, you can directly link your Groupon account to your Visa or Mastercard credit or debit card. If you click on a Groupon+ deal, all you need to do is use your card at the participating location and Groupon will send you the discount as cash back on your account.
The exciting part about Groupon+ is that it removes two big pain points of using Groupon: You don't have to pre-pay, and you don't have to print a voucher and hand it over to the merchant, saving both time, printer ink, and, if you're using Groupon on a date at an expensive restaurant, embarrassment.