If 60% of their customers want to participate on a regular basis then that's more than enough to build a billion dollar business. I don't see where the scandal is.
- what type of businesses are Groupon users after? Obviously restaurant coupons are very popular, but why are Groupon users on Groupon?
- what type of businesses benefit most from Groupon's model?
The issue here is that the businesses that present the largest draw for Groupon consumers may not in fact be the businesses that benefit most. In an eventual steady state, businesses that can't make the Groupon model work for them will stop using it, and I have a sneaking suspicion many of these business types are the main reason people are on Groupon to begin with.